Standard Chartered’s Steve Englander and Dan Pan highlight that the latest US Nonfarm Payrolls report showed an unexpected labour-market pick-up, with accelerating job gains and a lower unemployment rate. Despite sizeable downward benchmark revisions, they see signs of recovery across sectors and argue that recent data point to improving labour-market conditions into 2025 and 2026.

NFP upside hints at ongoing repair

"The January employment report showed an unexpected pick-up in the labour market, beating almost all estimates."

"Accelerating job gains, a lower unemployment rate (UR) and a higher employment-population ratio point to a pick-up in the labour market in late 2025 and into 2026, despite large downward benchmark revisions to past data."

"Health care and social assistance remained the key drivers, but other sectors are also showing signs of recovery."

"There are still questions on whether labour-market conditions will continue to improve, but the recent data point to some improvement."

"Upside surprises from a single month’s data are insufficient to fully allay labour-market concerns, especially considering soft sentiment and the potential AI shock."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)