US April jobs report - Economists react

"We think inflation is likely to rise more rapidly than [policymakers at the Fed], leading to a tighter stance of policy than even they assume – our end-2017 forecast for the federal funds rate is a range of 2.25-2.5% (versus a median projection of 1.875% from Fed officials). In support of our view, Friday’s Employment Report suggested wage inflation is picking up steam." - Capital Economics

"Employment is usually a good indicator of the underlying growth in the economy so it is not a good sign that we now have a combination of slower GDP growth and slower employment growth. Recently four Fed members said the door is open to a hike in June, but we think the weak employment growth in April has closed it. While their comments are interesting, we think it is important to remember that most of the voting FOMC members have a dovish stance on monetary policy." - Danske Bank

"This is certainly not the unequivocally strong report that the Federal Reserve would have liked to see. But at the same time, the details suggest that the labor market has not lost any underlying momentum, an assessment that is also confirmed by extremely low jobless claims. With the upward move in hourly earnings, the door for a June hike thus still remains open. But it is clear that we soon need to see some more convincing numbers for it not to close." - Unicredit Research

"The April employment report provides further evidence that the economy is showing clear signs of slowing and supports our view for no rate hikes this year. We continue to think that the FOMC will keep rates on hold throughout 2016 and 2017 as they wait for further evidence that the economy is accelerating and that global financial conditions remain benign." - BNP Paribas

This report is not going to change the mind of anyone at the Fed who wasn't already keen to hike in June. They are the minority, so we're sticking to our view that the next hike will come in Sep. By then, payroll growth will be back at 200K, unemployment will be 4-3/4%, GDP growth will have rebounded, core inflation will be a bit higher, and hourly wage growth will be 2-3/4%. None of these things will be apparent by the June meeting, which also comes just eight days before the UK could vote to blow up the E.U. This is a cautious Fed, and they'll think the price of waiting is low. - Pantheon Macroeconomics

"On net, the softening in April payroll growth, led by the service-providing sector, will likely raise concerns over the sustainability of US growth. We now only expect one rate hike in 2016, in September, down from two hikes previously, as we believe it will take longer for policymakers to accumulate sufficient evidence that economic and labor market activity is rebounding after a soft start to the year. If the economy improves along the lines of our baseline forecast, there is a risk of a second rate hike this year in December." - Barclays Research