The March 2025 U.S. jobs report delivered a strong upside surprise with non-farm payrolls rising by 228K, well above the 135K expected, and supported by a +2K net revision to previous months. The unemployment rate ticked up to 4.2%, slightly higher than forecast, though the participation rate improved to 62.5%, suggesting more workers re-entered the labor force. Wage growth held steady, with average hourly earnings rising 0.3% m/m and 3.8% y/y, slightly softer than last month. Private sector hiring was solid at +209K, while full-time jobs rebounded strongly by +459K after a massive drop last month. The leisure and hospitality sector led gains with +43K jobs, bouncing back from a weather-suppressed February. Despite the upbeat data, markets are showing a disconnect, as the U.S. dollar ticked modestly higher, while rate markets still price in over 5 Fed cuts this year—highlighting ongoing tension between labor market strength and inflationary concerns.
Details of the report showed.
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Non-farm payrolls: +228K vs. +135K expected (Prior revised to +117K from +151K)
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Two-month net revision: +2K
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Unemployment rate: 4.2% vs. 4.1% expected (Unrounded: 4.1519% vs. 4.1396% prior)
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Participation rate: 62.5% vs. 62.4% prior
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U6 underemployment rate: 7.9% vs. 8.0% prior
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Average hourly earnings (m/m): +0.3% (in line)
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Average hourly earnings (y/y): +3.8% vs. +3.9% expected (prior +4.0%)
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Average weekly hours: 34.2 vs. 34.1 prior
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Private payrolls: +209K vs. +140K expected
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Manufacturing payrolls: +1K vs. +4K expected (prior revised to +8K)
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Government jobs: +19K vs. +11K prior
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Household survey: +201K vs. -588K prior
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Full-time jobs: +459K vs. -1.193M prior
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Leisure & hospitality: +43K vs. -17K prior
Prior to the US jobs report, China notes reciprocal tariffs against the US. That sent the AUD and the NZD lower. They were the weakest of the major currencies today versus the US dollar (the US dollar rose by 3%and 2% respectively). The dollar gain the most versus the JPY and the CHF.
The US dollar is closing the week mixed versus the major currencies. The USD was higher vs the GBP, AUD and NZD, but was lower vs the EUR, JPY, CHF and the CAD.
Below is a graphical look at the percentage changes versus the greenback for the major currencies.
In the US debt market yields were sharply lower earlier today ahead of the US jobs report, but rebounded higher after the better-than-expected data.
The levels going into the close are showing:
- 2- year yield 3.678%, -4.6 basis points. The low yield for the day reached 3.467%
- 5-year yield 3.727%, -3.1 basis points. The low yield for the day reached 3.526%.
- 10 year yield 4.013%, -4.2 basis points. The low yield for the day reached 3.860%
- 30 year yield 4.426%, -5.7 basis points. The low yield for the day reached 4.331%.
Even though yields are well off their lows for the day, the current changes for the week are still down 22 to 26 basis points across the yield curve. Below is the high basis point change, the low basis point change and the current basis point change.
US stocks fell sharply for the second consecutive day.
The final numbers are showing:
- Dow industrial average -2231.07 points or -5.5% or 38314.86
- S&P index -322.44 points or -5.97% at 5074.05..
- NASDAQ index -962.82 points or -5.82% and 15587.79.
- Russell 2000-83.51 points or -4.37% and 1827.03
The trading week for each of the major indices was the worst going back to the 2020 pandemic
- Dow industrial average fell -7.86%.
- S&P index for -9.08%
- NASDAQ index fell 10.02%
- Russell 2000-9.70%
Oil prices also moved sharply lower this week. For the trading week, the price of crude oil fell -12.19%. That is its worst week since a 12.72% decline during the week of March 13, 2023.
The price of crude oil fell on the back of the tariff news and expectations of slower global growth. In addition, the OPEC+ alliance, led by Saudi Arabia and Russia, announced a larger-than-expected increase in oil production. Starting in May 2025, the group will boost output by 411,000 barrels per day (bpd), effectively implementing three months’ worth of planned increases in a single month.
The price of WTI crude oil is settling at $61.99 down $4.96 or 7.40%.
