US NFP: Strong job gains but weaker wage growth in Jan - Natixis

Analysts at Natixis express their take on Friday’s US payrolls data, noting that the labour market report was unambiguously a good one.

Key Quotes:

“Today’s report is unambiguously a good one as total job gains increased by a solid 227K in January (after 157K in December).”

“In addition, even though the unemployment rate is now slightly higher (+0.1pt to 4.8%), the participation rate also increased (+0.2pts to 62.9%).”

“On the negative side, average hourly earnings were much weaker than expected (+0.1% MoM, 2.5% YoY).”

“In short, the pace of job creations is hefty while the unemployment rate is at its long term level.”

“Yet, the trend in wages is slower than previously thought which is consistent with the Fed remaining on hold at the March meeting.”