American employers added 151,000 nonfarm jobs in August, the U.S. Labor Department reported Friday.
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Stocks started the day with big gains following the Labour Department’s job report.
That actually helped send the market higher because a very strong report could have pushed the Fed to raise interest rates as early as this month.
Mohamed el-Erian, Allianz chief economic adviser, stated that the mixed employment data places the U.S. central bank in a rather hard situation. It was a solid jobs report but lacked the punch needed to spur the Federal Reserve to hike interest rates in September, analysts say.
Last month’s jobs gains, however, could still be sufficient to push the Fed to raise interest rates in December. After this mildly disappointing August print, a rate hike in September is less likely but it’s still on the table.
The dollar was marginally higher against a basket of currencies. The yield on the benchmark 10-year Treasury fell to 1.55% from 1.58% minutes after the 8:30 a.m. ET report before bouncing back to 1.58% by 9:00 a.m, according to Tradeweb.
Hiring cooled in August but remained consistent with steady USA job growth capable of holding down unemployment and producing decent wage gains.
Besides, as much as economists’ may have overestimated last month’s labor market strength, it doesn’t look much like anyone else did.
151,000 jobs added in August vs est. The jobs report is not too surprising either, as in the last five years, August report has missed estimates every time.
“We’re in a low-expectation environment and these numbers are still positive”, said Ellis Phifer, market strategist at Raymond James in Memphis, Tennessee, in reference to the U.S.jobs data.
Employment data has been a crucial factor for Janet Yellen and the Fed’s rate-setting committee in determining the possible timing of a rate hike – the second since last December in a move that signalled the end of the financial crisis. “September seems to be off the table now”.
Economists, he said, had predicted an increase of 180,000 jobs. We are committed to a raising wages agenda, and we will fight tirelessly to elect candidates who support policies that pay family-sustaining wages and lead to economic stability.
The length of the average workweek fell to 34.3 hours from a revised 34.4 hours in July. But a calendar quirk could mean a soft reading, which would pull down the year-on-year from 2.6 percent in July.
“In order to be “reasonably confident” that inflation will return to target, average hourly earnings will need to rise by more than 0.1% each month, as they did between July and August”, they wrote in a research note. That’s the number of jobs that have to be produced each month to keep the unemployment rate at its current level while accommodating population growth. The labor-force participation rate held steady at 62.8% in August.
There were 151,000 jobsadded to the United States economy in August, below economists’ forecasts for 180,000 and a marked slowdown after two bumper months of growth.
Wages were up 0.1 percent for the month and 2.4 percent rate over the past 12 months. It fell $2.31, or 4.7 percent, to $46.39 while Royal Caribbean lost $2.70, or 3.7 percent, to $70.01.
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Last month, manufacturing sector employment was likely flat after rising for two straight months. Since September 2014, when employment in mining reached a peak, 223,000 jobs in that sector have been cut.
