July 2023 saw US non-farm payrolls fall by 23,000 in July, undershooting market forecasts and diminishing expectations for a September Federal Reserve rate hike. According to the Bureau of Labor Statistics (BLS), private payrolls rose modestly by 30,000 while government employment dropped significantly by 53,000.
Chris Zaccarelli, chief investment officer at Northlight Asset Management, commented on the report, stating, “This morning’s report is a game changer in the sense that all of the recent focus has been on inflation and this report highlights the risks that are embedded in the labor market as well.”
Following the data release, Bitcoin experienced a modest rise by about 0.7%, while global equities gained ground and Treasury yields declined.
The average hourly earnings increased slightly to $37.62, but the unemployment rate fell to 4.1% due to the shrinking labor force by 264,000 participants and an overall drop in participation rates to 61.4%.
While the precise reasons for July’s payrolls decline remain uncertain, experts noted that both private sector employment and government employment played significant roles. The CME Group reported volatility in Treasury yields and equity markets as investors reassessed monetary policy expectations post-data release.
Written by Kate Hollinsworth
Economics Desk
