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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
DATA REACT
It's hard to see the Fed leadership looking at the May employment report and saying, "yep, this is substantial further progress" on employment. Another miss and insufficient upward revisions to justify huge optimism in these numbers - two-month payrolls creation of 840k when you're 10 million in the hole is unlkely to be enough to push the tapering conversation much further at the June FOMC.
- A weak participation rate (down 0.1pp to 61.6% vs 61.8% expected) mitigates the impressively lower unemp rate (a drop to 5.8%, from 6.1%). Progress there is going at a snail's pace and has basically gone sideways since last summer.
- Higher avg hourly earnings (+2.0% Y/Y vs 1.6% exp, +0.4% prior) will certainly feed the labor shortage narrative further, but probably not much we didn't know before from other indices and anecdotes (also weaker AHE has been associated w lower-skill jobs creation, which is part of the "inclusivity" criteria for the Fed, so strength there might not be quite so "hawkish").
- The BLS reports: "The data for the last 2 months suggest that the rising demand for labor associated with the recovery from the pandemic may have put upward pressure on wages. However, because average hourly earnings vary widely across industries, the large employment fluctuations since February 2020 complicate the analysis of recent trends in average hourly earnings."
Source: BLS, MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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