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NFP: What are analysts saying


The latest Non-Farm Payroll (NFP) report for June has landed, and analysts have been quick to release notes interpreting the implications for the U.S. economy.

While the 206,000 increase in June non-farm payrolls beat consensus expectations of 190,000, the unemployment rate rose to 4.1% from 4% previously.

Here’s what Wall Street analysts had to say:

DA Davidson: “The unemployment rate ticked up again to 4.1%, which was ahead of expectations of 4.0% and shows some weakness in the job market. Wages were as expected, but are consistent with disinflationary pressure, which may be the most market friendly data point out of this job report.”

BMO Capital: “The temp penetration rate (TPR) was 1.68%, down -3bp m/m and off from March 2022’s 2.1% all-time peak. We note that historically, once this metric falls below 1.85% the U.S. has been in a recession. As always, we caution investors that this monthly data series is notorious for revisions as shown this month.”

Keefe, Bruyette & Woods: “June’s above-consensus job gains imply positive near-term 2024 P&C premium and broker revenue growth, although we expect this growth to decelerate as commercial insurance pricing increases slow.”

Goldman Sachs: “The report overall was softer-than-expected, and downward revisions lowered the three-month average pace to +177k from +249k as previously reported. The industry composition was also soft, as government and healthcare accounted for three quarters of the June job gains, and several cyclical industries shed jobs. The household survey was soft, with the unemployment rate increasing 0.1pp to 4.1%, as a 277k increase in the size of the labor force more than offset a 116k increase in household employment.”

Evercore ISI: “Overall, labor market data once again suggests strength without heat, with payroll gains in recent months pointing to robust demand for workers which has been matched by strong supply stemming from high labor force participation and immigration. But measures of labor tightness such as unemployment, wages, and vacancies are all easing, supporting Powell’s optimistic view on the inflation outlook.”

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