The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.
In December, the US added 292,00 jobs on the payrolls, and that is well ahead of the 200,000 expected, and it is worth noting that the previous month’s number was revised higher to 252,000 from 211,000. The unemployment rate held steady at 5% which also bodes well for the US economy. The participation rate ticked higher to 62.6% from 62.5%, and this is an indicator that Janet Yellen will be pleased with.
The only item that held this report back from being a very bullish announcement was the hourly earnings numbers. The month-on-month earnings number decreased while the year-on-year reading increased, and both came in below expectations
Overall the announcement helps justify the Fed’s decision to raise interest rates last month, but with underwhelming earnings figures the US central bank will be hesitant to raise rates in the near-term. The dollar was the biggest benefactor as the prospect of more rate hikes are still on the card. For the same reason gold, silver and oil dipped on the back of the report. Indices initially reacted positively to the numbers but now gains have been reversed.