Highlights of the June 2018 US non-farm payrolls report

  • Prior was 213K (revised to 248K)

  • Private payrolls +170K vs +190K expected
  • Prior private payrolls 202K (revised to 234K)
  • Manufacturing +37K vs +25K exp
  • Unemployment rate 3.9% vs 3.9% expected
  • Prior unemployment rate 4.0%
  • Underemployment rate 7.5% vs 7.8% prior -- lowest since 2001
  • Participation rate 62.9% vs 62.9% prior
  • Goods producing +52K
  • Service providing +118K

Wages:

  • Average hourly earnings +0.3% vs +0.3% m/m expected
  • Prior avg hourly earnings +0.2% (revised to +0.1%)
  • Average hourly earnings y/y 2.7% vs 2.7% expected
  • Avg weekly hours 34.5 vs 34.5 exp
  • Prior avg weekly hours 34.5 (revised to 34.6)

The lowered underemployment rate stands out. The headline is soft but it's balanced by the revisions to the prior.

The story here is a strong economy that's adding jobs but evidently it's not fast enough and the knee-jerk is lower in the US dollar, but modestly. USD/JPY dipped to a low of 111.45 from 111.58 before the data and has mostly climbed back.