The August jobs report was just released by the Bureau of Labor Statistics early this morning, and it has been one of the most anticipated reports in months. Investors and economists have been awaiting the report because it’s an indicator of whether the economy is recovering, and it comes not long before the next meeting of the Federal Reserve.
Will the U.S. central bank begin tapering the quantitative easing program that has been propping up the markets? The markets are already reacting to this morning’s jobs news based on what investors believe they mean.
Talk of inflation has been swirling for some time amid all the stimulus that's been pouring into the market and the soaring debt levels in the U.S. The Federal Reserve has said that any inflation that does occur will be temporary, but one hedge fund macro trader says there are plenty of reasons not to Read More
The latest jobs report
Non-farm payrolls were reported to be 169,000 for August, compared to expectations of 180,000. Also the Labor Department sharply revised downward last month’s payrolls numbers, pushing them down to 104,000 from 162,000. June’s jobs numbers were also revised sharply downward from 188,000 to 172,000 jobs added during the month. Those significant cuts do not bode well for the economy or for the possibility that the number in this report is even close to accurate.
The Labor Department reported that unemployment during the month of August was 7.3 percent, so just slightly better than the 7.4 percent that had been expected. However, the participation rate dropped to 63.2 percent from 63.4 percent. The number of workers who had been employed for 27 weeks or more remained the same at 4.3 million.
Jobs report sends ripples through the markets
The numbers from this morning’s jobs report don’t look particularly great. They’re already moving the markets this morning, sending gold prices up over 1,390 an ounce. Just before the report came out, they had nosedived from around 1,370 an ounce to just over 1,360 an ounce.
Other ripples are going through the market was well. The dollar is losing strength and 10-year U.S. Treasury yields are falling as well. After the jobs report was released, 10-year yields fell to 2.87 percent from 2.96 percent before the report came out.
Equities are up slightly as well.