Non-farm payrolls results for June 2016
- Prior +38K (revised to +11K)
- Two-month net revision -6K
- Unemployment rate 4.9% vs 4.8% expected
- Prior unemployment was 4.7%
- Participation rate 62.7% vs 62.6% prior
- Change in private payrolls 265K
- Average hourly earnings 0.1% m/m vs +0.2% m/m exp
- Average hourly earnings 2.6% y/y vs +2.7% y/y exp
- Average weekly hours 34.4 vs 34.4 exp
- Underemployment rate 9.6% vs 9.7% exp
The average for the past two months at 149K is solid. That lines up with all the other economic data that's shown solid but not spectacular growth in the United States.
The rise in the unemployment rate simply brings it back to where it was in April.
I think there's a case to buy USD/JPY here. The market has gone too far in not pricing in a hike until Feb 2019. The Fed will dabble with a strong hiking bias again and, even if they ultimately don't hike, they will convince the market a rise in rates is coming sooner.