On July 5th, according to financial network news (Editor Zhao Hao), pre-market trading in the United States on Friday (July 5th), the employment situation report released by the US Bureau of Labor Statistics showed that non-agricultural employment in June was better than expected, but the data for the first two months was greatly revised. The unemployment rate further rose to 4.1%.

Specifically, the seasonally adjusted non-farm employment in the United States increased by 0.206 million people in June, higher than the market expectation of 0.19 million.

At the same time, the May data was greatly revised from 0.272 million people to 0.218 million people, and the April data was revised from 0.165 million people to 0.108 million people. After the revision, the total for the two months decreased by 0.111 million people compared to before the revision.

The data also showed that the US unemployment rate unexpectedly rose to 4.1% in June, the highest since November 2021. The market originally expected it to remain unchanged at 4%.

The latest number of unemployed people is 6.8 million. Compared with a year ago, the unemployment rate was 3.6% and the number of unemployed people was 6 million.

In addition, the employment participation rate rose slightly from 62.5% to 62.6%, in line with expectations; the U6 unemployment rate remained stable at 7.4%; and the average weekly working hours remained at 34.3.

The key indicator of inflation-the average hourly wage in June rose by 0.3% from the previous month and 3.9% year-on-year, which is in line with market expectations. Last month, the data rose by 0.4% month-on-month and 4.1% year-on-year.

It should be pointed out that the year-on-year wage growth rate of 3.9% is the lowest since July 2021.

Fixed income strategist Kathy Jones of Charles Schwab said that the downward adjustment of data for the first two months and the rise in the unemployment rate are important data points. In addition, wage growth is also slowing down, and all of these factors together indicate that the trend is slowing.

Some analysts believe that the June non-agricultural report confirms that after the surge in inflation in the first quarter, the trend of inflation falling back on track has returned. This may also boost the confidence of the Federal Reserve in the inflation outlook and push the Federal Reserve closer to starting to cut interest rates later this year.

However, there are also more pessimistic voices. "Fed megaphone" Nick Timiraos pointed out that the US unemployment rate rose from 3.96% in May to 4.05% in June. This data has risen by 0.22% since March (3.83%).

Timiraos wrote that from the perspective of the Sam rule, the three-month average is 0.42% higher than the 12-month low point, which is approaching the threshold of 0.5%. The "Sam rule" refers to when the three-month average of the unemployment rate is 0.5 percentage points higher than the 12-month low point, the economy has entered a recession.

After the data was released, the futures market showed that investors currently expect the Fed to cut interest rates twice this year, which will lead to lower US bond yields and an increase in US stock index futures. The spot gold price briefly fell and then rebounded significantly, expanding its daily gain to 1%.

"Last week we got the information that the speed of economic slowdown is faster than previously imagined. This non-farm report put the Federal Reserve in a comfortable position," said Peter Cardillo, chief market economist at Spartan Capital Securities.

Cardillo added, "If this situation continues next month, hourly wages do not continue to increase, then I think the Federal Reserve will cut interest rates in September and again in December."

Editor / jayden