Goldman Sachs investment research thinks payroll growth is a little to hot at the moment.
“Monthly payroll employment gains have averaged 293k over the last 6 months and have not dipped below 200k since February,” Goldman Sachs’ David Mericle said. “But payroll growth increasingly looks like an outlier.”
In a note to clients Tuesday, Mericle wrote that he sees job growth decelerating slightly, to under 200,000 per month, through 2016:
While the significant weight on the momentum variables in the short-run equation suggests that the deceleration is likely to be gradual, we expect payroll growth to eventually decline to just under 200k/month under our baseline forecast.