MNI BRIEF: US Jobs Rebound 272K, Jobless Rate Rises To 4%
Employment looks hotter-than-expected, reducing the chances of a near-term rate cut from the Federal Reserve
U.S. employment grew by a stronger-than-expected 272,000 jobs last month, blowing past forecasts for a rise of 180,000 and dashing prospects for any near-term interest rate cuts from the Federal Reserve.
Muddling the picture, the jobless rate, which is based on a separate survey, touched 4% for the first time since January 2022. Wage growth remained strong, with average hourly earnings jumping 0.4% on the month, leaving yearly gains at 4.1% -- still well above levels Fed officials see as consistent with price stability.
Federal Reserve officials have said the labor market is gradually coming into better balance, in part as immigration boosts the pool of available workers. This report, however, suggests things are still running hot and it could take more of a slowdown for inflation to come all the way back down to the Fed's target of 2%. (See MNI INTERVIEW: US Growth Too Firm For Fed To Hit 2%-Blanchard)