US employers added 209,000 jobs in June, according to Labor Department data on Friday that came in below economists' estimates for the first time in 16 months, signaling progress in the Federal Reserve's bid to fight inflation with higher interest rates
WASHINGTON (Pakistan Point News / Sputnik - 07th July, 2023) US employers added 209,000 jobs in June, according to Labor Department data on Friday that came in below economists' estimates for the first time in 16 months, signaling progress in the Federal Reserve's bid to fight inflation with higher interest rates.
Economists polled by US media had expected a jobs growth of 230,000 for last month, from a previously published 339,000 for May which the Labor Department now revised down to 306,000. The unemployment rate remained unchanged at 3.6%. Fed officials have said employment and wage growth have to cool significantly to effectively restrain the worst inflation the United States has encountered in four decades.
Inflation, as measured by the Consumer Price Index (CPI) hit 40-year highs in June 2022, expanding at an annual rate of 9.1%. Since then, it has slowed, growing at just 4% per annum in May, for its slowest expansion in two years. The Fed's favorite price indicator, the Personal Consumption Expenditures (PCE) Index, grew by 3.8% in April. Even so, that was more than double the Fed's 2% tolerance for inflation annually.
The Fed, in response to runaway inflation since the end of the coronavirus pandemic in March 2022, has raised interest rates by 10 times, adding a total of 5% to the previous 0.25%. Despite Friday's underwhelming jobs data for June, there was still speculation that the central bank could resume rate hikes this month onwards.
