The creation of jobs was much lower than the projected, so the monetary authority is expected to change its position, which prioritized inflation.
The Official Employment Data in the United States They showed a strong contraction in the creation of jobs, something that had already been advanced by private measurements. Of the 75,000 employees projected, There were hardly 22,000the second worst data so far this year. Among analysts, bad data consolidated reading that Federal Reserve (Fed) You must lower the rates at your next meeting on September 17.
Besides, The July data were revised slightly upwards, they rose to 79,000 from the originally estimated 73,000. For its part, the level of unemployment rose to 4.3% from 4.2%, as expected. Labor participation climbed to 62.3% from 62.2%, while wages increased 0.3% at a monthly level, in line with the projected.
In this way the strong cooling in the North American labor market is consolidated. By way of comparison, 833,000 jobs were created until August, a decrease of 48% year -on -year against the same period last year. It was a trend that was accentuated in the last three months, when only 114,000 positions were created, against the 427,000 of 2024, a collapse of 73%.
Cement for the market
From Balanz They argued that “although August inflation data will be known on Thursday of next week, today’s report most likely tilt the balance for the first 25 basic points of the Fed in its monetary policy rate in 2025”.
In this sense, they affirmed that “The market is incorporating that cut by practically 100%”. According to him Fedwatch what measures CME Groupin Wall Street They bet a 98% chance to the FED cut the interest rates at 25 points during their next meeting.
Jerome-Powell-Reserva-Federal.jpg
The dilemma for Fed
For his part, the Head of Research Sailing Inversiones, Theo Sojo, explained to Scope “Although the unemployment rate remained at 4.3%, the usual lag between employment destruction and increased unemployment suggests that You could be close to a trend change“
They also stressed that “the annual salary growth also showed some moderation (3.7% against 3.8% expected), which reinforces the labor market signal.” Sojo argued that “what Jerome Powell warned so many times – which a deterioration in employment would be the decisive signal – It seems to finally be confirmed“
In any case, the Sailing Investment analyst stated that “this situation puts the Federal Reserve against a complex dilemma: on the one hand, the labor market cools quickly, But on the other, inflation still remains close to a percentage point above the objective“
News in development.
Source: Ambito
