June U.S. Jobs Jump by 147,000, Unemployment Falls... July Rate Cut Now Unlikely

U.S. Nonfarm Payrolls Rise by 147,000
Exceeds Forecast of 106,000... May Jobs Also Revised Up
Unemployment Rate Drops from 4.2% in May to 4.1% in June
Probability of July Rate Hold Soars to 95%

Last month, employment in the United States increased unexpectedly, while the unemployment rate declined. Despite ongoing uncertainty over tariff policies, the labor market has remained resilient, leading to widespread expectations that an early interest rate cut in July is now off the table.

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On July 3 (local time), the U.S. Department of Labor announced that nonfarm payrolls rose by 147,000 in June 2025.

This figure significantly exceeds the Bloomberg forecast of 106,000 and is also higher than the May figure of 144,000. The nonfarm payroll increase for May was also revised upward from the initial 139,000 to 144,000.

The unemployment rate fell from 4.2% in May to 4.1% in June. The market had expected the unemployment rate to rise slightly to 4.3% last month, which would have marked the highest level since 2021, but instead, it declined by 0.1 percentage point, defying expectations.

It is analyzed that, despite President Donald Trump's aggressive tariff policies, employment remains robust.

Last month's "employment surprise" (higher-than-expected job growth) poured cold water on market expectations that the Federal Reserve would cut its benchmark interest rate this month. According to CME FedWatch, immediately after the employment report was released, the probability of a July rate cut plunged to 4.7%, down sharply from 23.8% the previous day. The probability of a rate hold reached 95.3%. The likelihood that the Fed will keep rates unchanged in September also surged from 6.3% the previous day to 20.7%.

Yields on U.S. Treasury bonds are also on the rise. The yield on the 10-year U.S. Treasury, the global benchmark for bond yields, climbed 4 basis points (1bp=0.01 percentage point) from the previous day to 4.33%. The yield on the 2-year U.S. Treasury, which is sensitive to monetary policy, jumped 8 basis points from the previous day to 3.87%.