USA-Job creations exceed expectations but unemployment rises – 04/11/2022 at 14:21

(Updated with details, market reaction)

by Lucia Mutikani

WASHINGTON, Nov 4 (Reuters) – The U.S. economy added more jobs than expected in October but a rising jobless rate suggests some easing in labor market conditions, which would allow the Federal Reserve (Fed) ) to slow the pace of its monetary tightening as of December.

The Labor Department on Friday reported 261,000 nonfarm payrolls added last month after 315,000 (revised from 263,000) in September.

Economists polled by Reuters predicted an average of 200,000 job creations, with their estimates ranging from 120,000 to 300,000.

The unemployment rate rose 3.7%, after reaching 3.5% in September, while the Reuters consensus gave it at 3.6%.

Last month, the average hourly wage increased by 0.4%, while the consensus was expecting an increase of 0.3% as in September, and it posted a year-on-year increase of 4.7%, as expected.

On Wednesday, the US central bank unsurprisingly raised its main interest rate by three-quarters of a point but suggested that future increases in the cost of credit may come at a slower pace.

➦ RPT-USA-Fed Hikes Rate 75bps, Suggests Possible Slowdown

Employment growth has remained solid, even if domestic demand is showing signs of weakness with the rise in interest rates.

With the risk of recession becoming more pressing, companies could soon stop replacing their resigning employees.

According to the results of the Institute for Supply Management’s monthly survey, some entrepreneurs in the service industry are “reluctant to fill vacancies” due to uncertain economic conditions.

The job market nevertheless remains tight, with 1.9 job offers per unemployed person at the end of September.

On Wall Street, futures contracts on the main indices accentuated their gains and the dollar fell 1.07% against a basket of international currencies after the publication of these figures.

On the bond side, Treasury bond yields reduced their progression, the ten-year one US10YT=RR moving to 4.129% against around 4.16% ten minutes before the publication of the statistics.

(Report Lucia Mutikani, French version Laetitia Volga, edited by Kate Entringer)

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