What this release is
The US Average Hourly Earnings report measures the month over month change in the average hourly wages for all employees on private non-farm payrolls. This data is published monthly by the U.S. Bureau of Labor Statistics as a component of its comprehensive Employment Situation Summary. It provides insight into the compensation trends within the American labor market.
Forex traders closely monitor average hourly earnings because wage growth is a significant indicator of inflationary pressures in the economy. Sustained increases in wages can lead to higher consumer spending and production costs, potentially contributing to broader inflation. The Federal Reserve considers these trends when evaluating the economic outlook and determining its monetary policy stance, which in turn influences the U.S. Dollar.
Market participants typically focus on the headline month over month percentage change in average hourly earnings upon its release. Revisions to previous months’ data are also observed for their implications. This report is released simultaneously with other key employment figures, contributing to a collective market reaction. Historically, this series has often been associated with a high impact on currency markets.