US May nonfarm payrolls +172k vs consensus 85k. Mar–Apr payrolls revised up a
combined 93k, reversing prior downgrades. Three-month employment gain is the
strongest in over two years; hiring breadth widened, with both new hires and
rehires contributing and payrolls surpassing the employment-growth breakeven.
Market pricing: markets are now fully pricing a 25bp Fed rate hike by year-end.
Market comment: the print removes the near-term case for Fed cuts; officials
arguing for cuts would look out of step, and a few more prints like this could
warrant multiple hikes.
