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US jobs data marginally disappoints

The non-farm payrolls report from the US was broadly a let-down as the headline missed estimates.

CFDs are a leveraged product and can result in losses that exceed deposits. Trading CFDs may not be suitable for everyone, so please ensure you fully understand the risks and take care to manage your exposure.
US flag
Source: Bloomberg

June’s figures came in at 223,000, while the market was anticipating a reading of 233,000. To make matters worse, the May report was revised lower to 254,000 from 280,000. The unemployment rate dropped to 5.3% from 5.5% in May, but this is down to the decline in the participation rate from 62.9% to 62.6%. The message to take away from the report is that the US jobs market was a touch softer in June, but an interest rate hike by the Federal Reserve is still a reasonable possibility this year.

The Dow Jones and S&P 500 both pushed higher on the back of the announcement, but the move wasn’t massive. The FTSE 100 and DAX experienced a more muted reaction.

EUR/USD and GBP/USD are lower after the report, and given the unemployment number was assisted by the weaker participation rate, the dollar rally will be in for a correction.

Gold initially sold off, but it has regained its lost ground for now as traders realised the unemployment number wasn’t as strong as initially suspected.

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CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.