– by Lucia Mutikani
Washington (Reuters) – Strong data from the US labor market have speculation of an early turnaround in interest rates given new food.
The number of new jobs rose in May to 280,000, as the Ministry of Labour announced in Washington on Friday. Such a big jump, it has not been seen since December. Economists polled by Reuters had only 225,000 new jobs on the list for May. US central bankers warned last caution in tightening monetary policy after the economy shrank at the beginning. The desire of the International Monetary Fund (IMF) to delay a rate hike until 2016, now seems, however, rather unrealistic to. [ID: nL5N0YQ30S]
The promoted by the unusually cold winter economic slump earlier this year had raised concerns, the recovery could falter. The encouraging labor market data should the advocates of a rapid shift away from the ultra-loose interest rate policy once again give a convincing argument to the hand.
The prospect of rising interest rates lent the dollar a tailwind: The euro fell in the top one and a half cents to $ 1.1077. The US stock markets opened with slight losses. The data fueled speculation of an early turnaround in interest rates, said a broker. The Fed holds the key interest rate since the end of 2008 at the historically low level of zero to 0.25 percent. She wants to make with the cheap money ultimately for stable prices and full employment. This goal she comes now ever closer, even if the separately determined unemployment rose a tad to 5.5 percent. But the strong job figures speak for themselves: Just the private service providers have created 256,000 positions. The state contributed with 18,000 additional jobs for vigorous development of jobs in the US.
DEBATE ON rate hike regaining momentum
economist Harm Bandholz of UniCredit evaluates the strong data as evidence that the faintness of the economy has endured at the beginning: “That should the debate on bring a rate hike back on track “. The Fed watchers counted as many other experts also expect that the Federal Reserve in September tightens the reins interest. Recently there had been a number of disappointing reports from the industry – about the order situation of the industry and the consumer. [ID: nL5N0YO3A0] Therefore, a rate hike by the Fed already applies in June as unlikely. But Rob Carnell of the Bank ING considers it possible that the monetary authorities to act even in the summer: “In July or September, it might be so far.”
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