Employers added 151,000 jobs in August, a modest gain after an increase of 275,000 in July, the most in eight months, and 271,000 in June. The unemployment rate was unchanged at 4.9 per cent as more people entered the labour market.
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Federal Reserve Chair Janet Yellen and other Fed officials highlighted the economy’s improvement at a conference last month.
Lacker, who is not a voting member of the USA central bank’s rate-setting committee this year, said he still favors raising rates sooner than later and that the Fed’s last policy meeting in July would have been a “good time” to tighten policy.
Traders of interest rate futures see about a one in four chance of a rate hike at the Fed’s September 20-21 meeting. Like the unemployment rate, that measure has shown little improvement over the a year ago.
“Most (Fed policymakers) think another rate hike sometime soon is the right thing to do”, Roberto Perli, Cornerstone Macro economist wrote after the report. Before Friday’s report, markets were pricing in only about a 25% chance of an interest-rate hike in September, but that fell to just a 12% chance after the data release.
Even though substantial labor market slack has been reduced, millions of Americans remain unemployed, a source of frustration that could weigh on the minds of some voters in the November presidential election. The Dow Jones Industrial Average added 111.49 points, or 0.6 percent, to 18,530.79. But wage growth is expected to be moderate. IHS Markit believes that in the near term, USA payrolls will increase at an average monthly rate of around 175,000, which implies a steady unemployment rate. The labor-force participation rate held steady at 62.8 percent after April and May wiped out gains from earlier this year.
The current pace of hiring is still enough to lower the jobless rate over time – but for now, it’s holding steady at 4.9 percent. Employment levels in industries such as construction, manufacturing, retail and transportation were flat.
In 2016, monthly job gains flip-flopped, plummeting to 24,000 in May and swelling to more than 10 times that number in June.
Almost 70 percent of respondents said they are very or somewhat confident they could land another good job.
Americans are particularly optimistic about the job market, the board’s survey found, with the percentage of Americans saying jobs are “plentiful” reaching its highest point in nine years. “But I’m calling for a discussion if what we see now persists until mid-September”.
As consumer spending ticked up last month, so too did consumer confidence as measured by the Conference Board.
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A second report from the Commerce Department on Friday showed the trade deficit fell 11.6 percent to $39.5 billion in July as soybean sales buoyed exports to a 10-month high, in another boost to the growth outlook for the third quarter.
