Friday, September 2, 2016

US labor market is losing momentum – Fed should continue to wait – ABC Online

Friday , 02.09.2016, 16:01
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The American labor market has August lost momentum.

As the US labor Department said in Washington on Friday, 151 000 new jobs were created in the economy. That’s had less than expected Bank economists on average 180 000 excess points. In addition, in the previous two months significantly more jobs than in August arose. Economists called the numbers though as solid, but saw no reason for a rapid rate hike by the US Federal Reserve.

The job structure in June and July was reported slightly weaker than previously at 1000 points. In June therefore 271,000 locations were added, in July there had been 275 000 jobs. In August, especially jobs in the services and the health sector have been created. however, in the manufacturing sector, there was a downsizing. However, the overall trend remains positive: From June to August 232 000 sites are on average been created. This is much more than in the first five months of the year


The unemployment rate stagnated at 4.9 percent, whereas analysts a decline to 4.8 percent expected. However, the rate is at a low level in May it had reached 4.7 percent, the lowest level since the year of 2007. Wage developments remained below expectations: In a monthly, hourly earnings rose by 0.1 percent, year over year the increase was 2.4 percent. These are respectively 0.1 points less than expected. In longer comparing developments remain moderate at best.

economist Ralf circulation of the Helaba nevertheless expressed confidence he spoke of a solid development. Even before the job report had referred to the strong growth in June and July than economists unsustainable. In addition, in principle, be noted that the labor market of full employment more what strong increase in jobs doing increasingly unlikely


For the Fed result, according to analysts no strong arguments for a rapid rate hike. The job report could not convince to raise the key rate as early as this month, the central banker, commenting on the research house Capital Economics. Currently, almost everything revolves in monetary policy to the question of when the Fed continues its started in late 2015 rate reversal. In the financial markets is therefore more expected later this year. Finally

is argued that the Fed’s interest did not want to raise in November before the US presidential election in order to avoid the charge of partiality. In the financial markets the reactions were on the labor market figures such as most strongly from, but are not sustained by the Bank. Thus the US dollar and US government bonds yields were initially charged significantly, but they were able to recover quite quickly. The stock markets reacted with gains contrast that stopped first.


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