The latest US non-farm payrolls release came in well ahead of expectations, with upward revisions to the two preceding months to boot. At first glance, the economy looks robust. Yet headline figures are expressed in month-on-month terms, meaning a high base one month produces a weak reading the next, and vice versa — an alternating pattern that characterised the period from early last year through this spring. What is more telling is that payrolls rose consecutively for four months between February and May last year, and again for three consecutive months between March and May this year. Seasonal strength may partly explain this, but month-on-month data alone cannot identify the cause.
