US June non-farm payrolls (372K, 260K expected) came in much stronger than the analysts had expected. The unemployment rate (3.6%) and the average hourly earnings (0.3%) came in in line with expectations while the participation rate ticked 0.1% lower. (62.2%, 62.3% prior).
This report provides the Fed with a green light to move ahead with aggressive rate hikes and as a result, the bond market is currently selling off and the yield-sensitive USDJPY is shooting higher in the intraday timeframes. Equity investors don’t like the take hikes so S&P 500 futures are taking a hit. Strong jobs report used to be great for stocks but in this inverted world we now live in good news is actually bad news.
All in all, the report is another reminder that the employment market in the US is indeed still very strong. It will take a lot to dent it and the Fed knows it. Therefore, we should still expect to see Fed being quite comfortable in its aggressive approach.
Chief Market Analyst
Open a VIP Black account now at www.TIOmarkets.com. We want you to be able to exploit trading opportunities in financial markets with 0 commission and tight spreads. Take advantage of the best trading account in the industry: Tiomarkets VIP Black. For more details on this truly exceptional offering see here. For more analysis and commentary, visit our YouTube channel where you can find market commentary videos to support your learning and growth as a trader.
DISCLAIMER TIOmarkets offers exclusively consultancy-free service. The views expressed in this blog are our opinions only and made available purely for educational and marketing purposes and do NOT constitute advice or investment recommendation (and should not be considered as such) and do not in any way constitute an invitation to acquire any financial instrument or product. TIOmarkets and its affiliates and consultants are not liable for any damages that may be caused by individual comments or statements by TIOmarkets analysis and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his/her investment decisions. The analyzes and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with any legal requirements for financial analysis and must, therefore, be viewed by the reader as marketing information. TIOmarkets prohibits duplication or publication without explicit approval. FX and CFDs are leveraged products. They are not suitable for every investor, as they carry a high risk of losing your capital. Please ensure you fully understand the risks involved. All the prices in this report are CFD prices based on price charts provided by TIOmarkets unless otherwise stated.