Pete Wargent blogspot

CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

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Saturday, 3 September 2016

US payrolls below expectation

71 months of expansion

The US Bureau Of Labor Statistics released its nonfarm payrolls figures for August, which showed employment increasing by +151,000 in the month. 

This was generally reported as a soft result being below expectations of +180,000, although after moderate revisions the US economy has added an average of +232,000 jobs per month over the last three reports (admittedly May was a stinker). 

Mining employment continued to decline to be down by -223,000 since September 2014, with job gains this month concentrated in health care (+14,000), social assistance (+22,000), financial activities (+15,000), and food and drinking places (+34,000). 

The tally of consecutive months of employment growth rose to 71, the highest on record.

Over 2016 calendar year-to-date average employment growth has been a little over +181,000 per month.

The unemployment rate was unchanged at 4.9 per cent, with the number of unemployed persons also little changed over the year at 7.8 million.

And average hourly earnings rose only moderately, up by 3 cents to $25.73, to be +2.4 per cent higher than one year ago.

Overall, a result that missed expectations but continued the theme of steady expansion. 

I haven't spent much time reading reactions, but market consensus is that the miss on expectations snuffs out the prospect of a September rate hike, with Fed tightening by the end of the year being an each-way bet.

Aussie dollar now buying a slightly higher 75.66 US cents.

100 not out

An interesting week ahead in domestic Aussie news. 

On Wednesday the ABS will report that Australia has notched up an impressive 100 quarters without a recession.

Although the quarterly result this time around will be a soft one - possibly very soft - the economy is still expected to have grown by around 3 per cent over the year to June.