U.S. hiring dropped unexpectedly with the smallest jobs increases in seven months, mudding a potential decision by the Fed to start cutting back monetary support.
- Non-farm payrolls rose 235, 000 last month after an upwardly revised 1.05 million gain in July. The U.S. unemployment rate dropped to 5.2%.
- The average estimate in a Bloomberg survey of economists was for a 733,000 monthly advance in August. The yield on the 10-year Treasury note reversed an earlier drop as stock index futures fluctuated.
- The deceleration in employment likely signals both growing concerns over the rapidly spreading delta variant of Covid-19 and challenges filling vacant positions.
- In August, 5.6 million people reported they were unable to work due to the pandemic, up from 5.2 million a month earlier.
The rise in Covid-19 infections may have led to businesses to grow more cautious about hiring and discourage some workers from seeking high-contract employment opportunities. U.S. payrolls are still 5.3 below their pre-pandemic level.
DXY down -0.19%, EUR USD up +0.20%Source: Bloomberg.