Editor
Employment rose by 275.000 last month, surpassing market excavation and relieving market worries.
surpassing economists’ expectations of 198,000. Employment in the U.S. rose by 275,000 in February, up from 229,000 in January (revised down). The report was released early today by the Bureau of Statistics and was one of the most anticipated reports this week and this month as well.
Labor market numbers have always been a strong indicator and a main factor in the Federal Reserve’s monetary policy decision-making processes. Job gains in February were widespread across sectors like healthcare, government, food services, and transportation, with minimal changes in manufacturing and professional services. Average hourly earnings increased by 0.1% month-on-month, slower than January’s 0.5% and projections of 0.2%. The unemployment rate rose to 3.9%, expected to match the previous 3.7%.
With a solid and growing labor market and increasing GPD growth, U.S. federal receiving officials will have more time to think about their next move. At the same time, moving cautiously means that the Fed will not cut interest rates. This will happen; however, timing is crucial. For that reason, the fed officials ensured that they would keep monitoring this trend closely. Cooling labor demand could support a case for lowering borrowing costs.
Fed Chair Jerome Powell emphasized a patient approach to fighting inflation, stating the Fed is nearing confidence that price gains are moving sustainably toward the 2% target. In his note to the lawmakers, Jerome says, “When we do get that confidence […] it will be appropriate to begin to dial back the level of restriction so that we don’t drive the economy into recession.” With these words, no one will deny that there will be at least one more interest cut this year, especially in June.
“a less tight job market, supporting the soft landing narrative and increasing the odds of a June rate cut,” UBS analyst Giovanni Staunovo said. In other economic news, the Bank of America notes that there is a diverse flow of funds. This includes many sectors and assets. Analysts noted that this event has happened only 10 times since 1930. This usually occurs when a lot of bubbles start.
The Bank of America noted this surge and said, “Fed causes bubbles and Fed pops bubbles, and in 2024, the Fed’s determination to cut rates means “we’re not too far from it”,” the analysts explained.
Below are the main data the BofA shared this morning:
- Money market funds led with substantial inflows of $30 billion.
- Bonds followed with inflows of $17.3 billion, while stocks attracted $6.9 billion, and cryptocurrencies saw inflows of $1.9 billion.
- Gold experienced outflows of $1 billion, according to Bank of America, citing EPFR Global data.
Following the labor market report, Wall Street was merely high due to rising concerns over the impact of this decision on municipal policies. The S&P 500 benchmark was up by 0.16% to a total of 5.165.20 basis points, slightly lower than the past week’s 5.200,00 basis points.
The Dow Jones average industrial future was flat, with 0% gains, to steady at 38.794.33 basis points. Tech stocks are still being maintained, boosted by quarterly earnings reports. The index was high by 0.36% to 16.336.20 basis points as of 11:40 a.m. ET.
