US jobless likely dropped to 4.9 pct in April

US nonfarm payrolls had risen by 215k in March. In April, they are likely to rise by 200k, in line with continuous improvement in labor market, according to Nordea Bank. It is slightly weaker than the average rise of 209k seen in the past three months and consistent with consensus expectations, noted Nordea Bank.

The growth in employment is expected to have continued at a stronger pace in April, given that the jobless claims are at a post-crisis low, indications of a stabilizing manufacturing activity and rebounds in the service sector, added Nordea Bank.

The US Fed is expected to see anything stronger than a rise of 150k in payrolls as in line with continuous tightening of labor market over time. The jobless rate is expected to fall to 4.9% in April from March’s 5%, said Nordea Bank. Consensus projection is also for the unemployment rate to fall to 4.9%.

The US labor force participation rate has likely continued to be at 63% in April following four consecutive rises. Meanwhile, the average workweek is forecast to have risen to 34.5 hours, according to Nordea Bank.

“We forecast an above-trend 0.3% rise in average hourly earnings in line with the gain in March. The year-over-year growth rate should edge up to 2.4% from 2.3% in March”, said Nordea Bank.