Goldman Sachs: We expect a below-consensus 85K non-farm payrolls | Forexlive

Goldman Sachs forecasts a below-consensus US payrolls print of +85k for June, well under the market’s 113k median. Softer big data signals, immigration policy changes, and federal layoffs should weigh on the headline, with the unemployment rate edging up and wage growth staying steady but set to decelerate further.

Key Points:

• Weaker Payrolls Growth:
  • Headline payrolls seen up 85k vs. 113k consensus, slowing from the 3-month average of 135k.
  • Soft big data trends, the expiration of Temporary Protected Status for 350k Venezuelans (-25k impact), and a 15k federal payroll decline are key drags.

• Unemployment Rate to Tick Up:
  • The jobless rate forecast to rise to 4.3% from an unrounded 4.24% last month.
  • This reflects sequential gains in broader labor slack measures.

• Wages on Track for Gradual Cooling:
  • Average hourly earnings expected to increase 0.3% MoM, with the wage survey indicator falling below 3%, pointing to further deceleration ahead.

• Strike Impact Offset:
  • Some upside from the end of worker strikes (+6k), but not enough to materially lift the headline.

Conclusion:

Goldman Sachs expects the June jobs report to confirm a slowing US labor market, which should reinforce the Fed’s gradual dovish shift and maintain downward pressure on the USD, particularly if wage growth signals further disinflation.

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