US hiring roared back in October after two disappointing months as employers added 271,000 jobs, the most since December.
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Fun fact: Food services and drinking-places added 42,000 jobs in October.
With Fed officials already saying they don’t want or expect the jobless rate to fall much further, it would likely take a devastating blow in the November hiring data or mayhem in financial markets for the majority of policymakers to give up on their expectation of a rate increase at their Dec.15-16 policy meeting.
Bank stocks rose, helped by the possibility of higher interest rates, while dividend-paying stocks like utilities sank. However, the long-haul segment lost 1,200 jobs between August and September, the latest data available for that segment.
CURRENCIES: The USA dollar was trading at 121.81 yen, up from 121.49 yen on Thursday. But that figure was likely unsustainable, many analysts say, given that the economy grew just 2 percent in the past 12 months.
“What we see is a domestic economy that is pretty strong and growing at a solid pace, offset by a few weakening spilling over to us from the global economy”, Federal Reserve Chairwoman Janet Yellen said Wednesday in congressional testimony.
In addition, average hourly earnings increased 9 cents last month. Over the year, the industry has added 368,000 jobs. It’s also well over the consensus forecast for the month of a new 182,000 jobs. The unemployment rate dropped to 5%.
The Standard & Poor’s 500 index was down 1 point to 2,098.
The Fed seemed poised to raise rates earlier this year based on the central bank’s fulfilling its dual mandate, that of full employment and price stability.
“If there was any doubt if the Fed would hike rates in December, it is gone now”, the website Zero Hedge opined.
In the energy markets, USA crude oil fell $1.12, or 2.4 percent, to $45.20 a barrel in electronic trading in New York.
In October, the number of native-born workers increased by 545,000 individuals.
Investors are also preparing for the release of the government’s monthly jobs report, out Friday.
Labor market data and inflation numbers – two inextricably connected economic indicators – are probably the two most important pieces of data influencing the Fed’s decision on the timing and trajectory of a rate hike.
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Services and health care have been particularly strong, though areas like manufacturing, mining and logging have been shedding jobs. The workforce participation rate remains mired at a 38-year-low of 62.4%; its parallel measure, the employment-population ratio, also remains unchanged at 59.4%.
