US: NFP supports further Fed’s tightening – UOB

Senior Economist at UOB Group Alvin Liew assesses the latest Nonfarm Payrolls figures released on Friday.

Key Takeaways

“The US economy added another 390,000 jobs in May while the unemployment rate stayed at 3.6%, unchanged since Mar. Wage growth continued but the pace slowed for the second straight month to 0.3% m/m, 5.2% y/y. Despite hiring challenges, some signs of weakness emerged such as the jump in those employed part-time for economic reasons and the dip in retail employment.”

“Notwithstanding those tentative signs of moderation, the overall US employment and wage gains in 2022 to date will anchor the Fed’s confidence in the labor market and keep them on the path to hike in clips of 50bps in Jun and Jul amidst on-going inflation.”