3rd December 2021
Ambiguous US Jobs Report Shows Growth Slump
The world’s largest economy added just 210,000 jobs for the month, a steep drop-off from the 546,000 positions created in October and well below economists’ forecasts of 550,000. Despite this stunted growth, the unemployment rate fell significantly, dipping from 4.6 to 4.2 per cent. Only six months ago was this number hovering close to 6%. Furthermore, the labour-force participation rate, which has been stagnant since mid-2020, rose to 61.8 per cent, up 20 basis points from October. So, albeit a disappointing headline number, other factors like the unemployment rate sparked a jump in equities, a drop in the US Dollar and eased expectations of a near-term Fed rate hike. US government bonds sold off modestly across most maturities. It is important to note that this data is pre the Omicron variant data unfolding, and it is overall unlikely that the November jobs report will tilt the Fed’s current hawkish sentiment.