The US dollar fell against all major currencies to rise to trade near 1.625 against the dollar. It also rose to 1.28 against the dollar, which fell below 150 against the yen immediately after the labor market report for November was issued, with which it rose again above $2,640 per ounce before returning and declining. It is currently located near $2635 per ounce.
While future contracts for US stock indices recorded increases immediately after the issuance of the labor market report for the month of November, amid a collective decline in returns on US Treasury bills, with the yield on the US Treasury bill for ten years falling below 4.16% so far, after it was near 4.20% before the report was issued. The American labor market for the month of November, which showed the addition of 227 thousand jobs outside the agricultural sector, while most expectations indicated the addition of only 200 thousand jobs after adding 12 thousand jobs in October. Revising them to 36 thousand.
This improves the picture of the performance of the labor market after it was previously shown by the statement of the change in the number of jobs within the private sector in the United States last Wednesday,with the addition of 146 thousand jobs in November,while expectations indicated the addition of 150 thousand jobs after adding 233 thousand in October. Thay were revised to… 184 thousand.
After industrial and service activity data for the month of November showed this week, the ISM Purchasing Managers’ Index within the American industrial sector rose to 48.4,while what was expected was a rise to only 47.5 from 46.5 for the month of October, with the employment component within the index rising to 48.1 from 44 in October.
While the ISM Purchasing Managers’ Index within the US non-manufacturing sector during the month of November showed a decline to 52.1, while it was expected to decline to only 55.5 from 56 in october, with the employment component within the index declining to 51.5 from 53 in October. It is indeed worth noting that reading this data Above 50 indicates expansion, below 50 indicates contraction.
As previously mentioned, the American labor market also reported this week: the New Job Opportunities and Labor Turnover (JOLTs) index, which measures employment and job opportunities versus layoffs and resignations within the United States economy, came at an increase of 7.744 million in October, while it was expected to rise to 7.48 million.Only from 7.443 million in September were revised to 7.372 million.
Yesterday, the Challenger report showed companies’ tendency to reduce the number of jobs by 57,727 thousand jobs in November from 55,597 thousand jobs in October. It is indeed worth noting that this statistic expresses companies’ future plans to reduce, not what has already been reduced.
While the U.S. report on the performance of the labor market in November showed an increase in the unemployment rate to 4.2%, as was expected, from 4.1% in October simultaneously occurring, with the disguised unemployment rate, which counts part-day workers who wish to work a full day, also rising to 7.8% from 7.7%. In October.
As for the inflationary pressures on wages in the United States during the month of November, today’s labor market report showed an increase in the average hourly wage per month by 0.4%, as happened in October, while it was expected to rise by 0.3%, with an annual increase of 4%, as also happened in October in When the expected increase was only 3.9%.
The report in this way keeps all options open to the members of the Market Committee,whether it is to reduce the interest rate by 25 basis points or keep it unchanged,while it is unlikely that the Fed will make a greater reduction than that when the members of the Market Committee meet on the seventeenth and eighteenth of this December after the Fed’s establishment. The Federal Reserve reduced interest rates by 50 basis points on September 18th and by 25 basis points last November.
After the recent statements issued by the members of the Market Committee and the Chairman of the Federal Reserve, in their entirety, indicated the progress that the Federal Reserve has achieved in reducing inflation rates without harming the labor market, which is still performing well, this makes the Federal Reserve not in a hurry to lower
The Federal Reserve remains optimistic about the U.S. economy’s ability to avoid a recession, even as it continues to tighten monetary policy to combat inflation.This confidence was expressed by Fed officials who emphasized the importance of balancing the need to cool inflation with the health of the labor market.
“The Federal reserve takes into account the performance of the labor market and is also interested in reducing inflation to the 2% rate it targets annually,” the officials stated. “In doing so it works in both directions in balance, with the market committee that specifies monetary policy continuing to rely on the data received to it without being proactive in making decisions.”
Markets are eagerly awaiting the Federal Open Market Committee’s (FOMC) meeting at the end of the month, hoping for insights into the Fed’s outlook on inflation, economic growth, the labor market, and future interest rate movements.
Despite the Fed’s confidence, the path forward remains uncertain. The effectiveness of the Fed’s policies in curbing inflation without triggering a recession is a key concern for investors and economists alike.
## Expert Interview: US Dollar Falls as Strong Labor Data Fuels Recession Fears
**World Today News Interview**
**Expert:** Dr. Emily Carter, Senior Economist at Blackwood Capital
**World Today News (WTN):** Dr.Carter, the US Dollar is experiencing a significant decline against major currencies following the release of the November jobs report. Can you explain what’s driving this move?
**Dr. Carter:** The November jobs report painted a picture of a surprisingly strong labor market,with 227,000 jobs added outside the agricultural sector,exceeding expectations. This strength signals continued resilience in the US economy, but it also raises concerns about the Federal Reserve tightening monetary policy further to combat inflation.
**WTN:** How does a strong labor market contribute to a weaker US dollar?
**Dr. Carter:** When the US economy performs well, it typically attracts foreign investment, driving up demand for the US dollar. However,if investors anticipate further aggressive interest rate hikes from the Federal Reserve,which could possibly lead to a recession,they might move their investments to less risky assets or other currencies,weakening the dollar.
**WTN:** We also saw fluctuations in gold and US Treasury yields. Can you shed some light on these movements?
**Dr. Carter:**
Gold frequently enough acts as a safe haven asset during times of uncertainty. The initial sell-off in gold after the report suggests investors were initially optimistic about the economy and risk-on sentiment prevailed.Though, the subsequent pullback and decline indicate growing concerns about the potential for a recession due to the Fed’s aggressive stance.
US Treasury yields,especially for ten-year bonds,fell after the report. This decline indicates that investors are revising their expectations for future interest rate hikes. While the labor market remains strong, concerns about a potential recession are driving demand for safer investments like US treasuries, leading to lower yields.
**WTN:** What are the other key economic indicators we should be watching closely considering this jobs report?
**dr. carter:** The upcoming Consumer Price index (CPI) and Producer Price Index (PPI) reports will be crucial in providing more insight into inflationary pressures. If these reports show sustained high inflation,the Fed is likely to maintain its hawkish stance,potentially putting further downward pressure on the dollar. we should also be closely monitoring data on consumer confidence and retail sales to gauge the health of consumer spending, a key driver of the US economy.
**WTN:** Thank you for your valuable insights, Dr. Carter.
