Nonfarm payrolls headline soft but revisions and unemployment rate tell a different story
The nonfarm payrolls headline is weak but the market reaction is overly dramatic.
The US dollar is getting killed on the kneejerk. Especially in focus is the drop in private payrolls at 126K vs 180K. The August revision on the private side was to 161K from 152K, which is much smaller than the upward revision to government jobs.
The good news is that the unemployment rate fell to 7.2% — the lowest since Nov 2008. It doesn’t come on a drop in labor force participation, which held at 63.2%.
This number isn’t as bad as the market reaction suggests but maybe it reflects pent-up demand to dump dollars, rather than a true reaction. Given the struggles of the US dollar, not sure now is the right time to fade this move.