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Good Jobs Report But Fed Is Unlikely To Move In View Of Delta Variant
Week Ending August 6th, 2021
Much awaited July’s jobs report released on Friday, added more to the Federal Reserve’s worries. It was reported on last Friday that total non farm payrolls rose by 943,000 in July and the unemployment rate declined by 0.5% to 5.4%. The labor force participation rate remained little changed at 61.7% . Average hourly earnings rose by 0.4% on monthly basis and the yearly gain stands at 4% now.
It is definitely a good report and confidence booster for investors and federal reserve. But the data for this report was collected in the first half of the last month and before CDC issued new recommendations. I don’t think this surprisingly good report can sway the mind of federal reserve as a group. Fed will more likely wait for 1-2 more jobs reports along with other data sets, before it decides to start tapering. Moreover delta variant is causing another round of disruptions and I think this will slow down the economic recovery definitely at least for 1-3 months but I think the impact will be much less as compared to the first wave.
Markets are expected to trade in narrow range going forward and we will be witnessing pullbacks quite often.
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By Jaspreet Singh PaddaWeek Ending August 6th, 2021
Much awaited July’s jobs report released on Friday, added more to the Federal Reserve’s worries. It was reported on last Friday that total non farm payrolls rose by 943,000 in July and the unemployment rate declined by 0.5% to 5.4%. The labor force participation rate remained little changed at 61.7% . Average hourly earnings rose by 0.4% on monthly basis and the yearly gain stands at 4% now.
It is definitely a good report and confidence booster for investors and federal reserve. But the data for this report was collected in the first half of the last month and before CDC issued new recommendations. I don’t think this surprisingly good report can sway the mind of federal reserve as a group. Fed will more likely wait for 1-2 more jobs reports along with other data sets, before it decides to start tapering. Moreover delta variant is causing another round of disruptions and I think this will slow down the economic recovery definitely at least for 1-3 months but I think the impact will be much less as compared to the first wave.
Markets are expected to trade in narrow range going forward and we will be witnessing pullbacks quite often.