BLS revises payrolls down by 911,000, shocking economists

In the United States, the Bureau of Labor Statistics (BLS) released significant revisions to the preliminary benchmark total payrolls for March 2025. The revision indicated a decrease of 911,000 jobs, which was substantially greater than analysts' median estimates of a 682,000 reduction. This unexpected adjustment raised concerns about the actual state of employment in the U.S., sparking mixed reactions in the financial markets and raising questions about future labor market conditions. The new figures also fell outside the anticipated forecast range, contributing to broader discussions about economic growth and job recovery in the aftermath of the ongoing effects of the pandemic. In conjunction with these revisions, several geopolitical factors influenced market dynamics. Notably, there were reports of Israel attacking Hamas officials in Doha, which affected crude oil prices positively but also brought heightened volatility in global markets. As tensions in the Middle East escalated, investors reacted by adjusting their portfolios, leading to mixed performances in equities and treasury yields. The initial market response involved a rebound in T-notes, as investors sought safe-haven assets amid uncertainty surrounding oil supply chains. Furthermore, the auction results of U.S. Treasury notes revealed robust demand despite the negative labor data. The Treasury successfully auctioned USD 58 billion of 3-year notes at a competitive yield, showcasing investors' willingness to purchase government debt in light of economic uncertainties. This demand indicates mixed sentiments regarding inflation and interest rates, compounded by the indications from the Bank of Japan (BoJ) regarding potential future rate hikes. The fact that some officials within the BoJ observed chances of a rate hike within the year, although they suggested maintaining current rates for September, also played a role in global market reactions. Investors are closely watching central banks’ policies as they navigate recovery strategies amid fluctuating employment numbers and ongoing geopolitical tensions. Overall, the employment revisions highlighted vulnerabilities in the labor market, encouraging continued scrutiny of U.S. economic resilience in the face of both domestic and international challenges.