“A more plausible explanation is that the strong job market momentum of the past two years is slowing”, Behravesh wrote.
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The lack of clarity about a rate hike from the Fed this month boosted gold.
It comes after Federal Reserve chairman Janet Yellen last month signalled that United States interest rates could rise following a strong performance from the world’s largest economy. A rate hike at the September Federal Open Market Committee meeting was seen as a possibility. “It confirms that the economy is performing well, but does not provide the threat of overheating that might have caused an interest-rate increase sooner rather than later”.
“Some Fed officials were anxious the economy was set to blow past full employment, which would be problematic because returning the economy to full employment without triggering a recession would be hard”, he explained. Its policymakers raised their key rate modestly in December but have stood pat since.
“The report doesn’t support the case for a September rate hike”, said ING Senior Economist James Knightley.
Bank stocks were down in the pre-market.
Bank of America, Citigroup and JPMorgan were down between 0.5 per cent and 0.16 per cent. The August gain was smaller than economists had expected. The proportion of Americans who are either working or looking for work has been flat for about two years near a 40-year low.
The Fed lifted its benchmark overnight interest rate at the end of past year for the first time in almost a decade, but has held it steady since amid concerns over low inflation.
The unemployment rate remained steady at 4.9 percent for the third month in a row, with the number of long-term unemployed unchanged at 2 million people. That has not shifted much over the year.
Lululemon Athletica was down 9.2 percent, on track for its worst day since early December, at $69.62 after the Canadian yoga wear retailer reported quarterly comparable-sales growth below expectations.
The jobless rate has plunged from 8 percent at the start of 2013. That probability rises to 63 percent by year end.
As for hiring, Mr Esch said: “The headcount increases are below what we’d like to see or expect to see coming out of a recession”.
Consumers are more confident and have been spending at a steady clip.
For the past five years, the August jobs report has initially come in below forecasts, only to revised higher by about 70,000, economists say.
Still, worker pay hasn’t accelerated almost as much as in previous economic recoveries.
Still, a blowout report on Friday, with job gains above 200,000 and a solid increase in average hourly pay, could prompt the Fed to accelerate its timetable.
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That figure masks wide variations among industries and occupations. Starting salaries should jump 6.4 percent for data scientists, 6.2 percent for web developers and 5.7 percent for network security engineers, the firm estimates based on surveys of its clients. That would be below the 255,000 gained in July and June’s 292,000, which was the most in eight months.
