Washington. Employment in March showed signs of optimal health of the economy in the United States, with job creation much higher than expected by a market that fears that these data will prompt the Federal Reserve (Fed) to delay the expected rate cuts. interest.
The largest economy in the world added 303 thousand jobs in March, a sharp increase compared to the 270 thousand the previous month, the Department of Labor reported this Friday. This figure exceeded market expectations of an increase of 200 thousand jobs. Meanwhile, the unemployment rate fell from 3.9 percent in February to 3.8 percent last month and wages increased 0.3 percent monthly, in line with expectations.
President Joe Biden, who makes the strength of the economy one of his campaign arguments, maintained that the United States is going through the longest period in 50 years with unemployment below 4 percent. “In March we surpassed the barrier of 15 million jobs created since I took office” in 2021, highlighted the Democratic president.
On Thursday, employment statistics in the private sector had already given a trend for the month of March, with numbers also higher than expected.
Data from the Labor Department shows strong employment in sectors such as health care and construction, a sign that the real estate sector, pressured by high interest rates, could be recovering. On the other hand, others such as leisure, hospitality and the public sector remain below pre-pandemic trends.
What about the rates?
Policymakers at the Fed, the U.S. central bank, have been debating when the right time will be to start cutting interest rates as they seek to bring inflation to 2 percent without harming the economy.
Record inflation, which reached 9.5 percent in June 2022 in the United States, led the Fed to sharply increase its interest rates, which went from 0 to 5.50 percent between March 2022 and August 2023. Since then they have remained unchanged in a range of 5.25-5.50 percent. High rates make credit more expensive and discourage consumption and investment, thus reducing pressures on prices.
Inflation fell sharply last year, while the economy and labor markets have remained resilient. But it has risen since the beginning of this year, prompting some central bank officials to delay their expectations for the start of cuts.
Indices on Wall Street rise
Wall Street’s main stock indexes finished higher on Friday, following strong employment data that reinforced the view that the economy remains healthy, although it means the Federal Reserve could delay cutting interest rates. Money markets now expect around two rate cuts this year, up from three a few weeks ago, according to the firm LSEG.
The Standard and Poor’s (S&P) 500 index gained 1.12 percent to 5,204.30 units; The Dow Jones rose 0.79 percent to 38,903.16 units, while the Nasdaq climbed 1.21 percent to 16,248.52 units.
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– 2024-04-14 02:03:24
