Fresh figures have shown the US economy has added far fewer jobs than expected by analysts. While non-farm payrolls increased, the figure wasn’t impressive enough to suggest the Fed would raise interest rates in June.
Friday’s April payrolls data revealed the US economy added the fewest jobs in seven months, raising concerns that the weakness in overall economic activity was spilling over to the domestic labor market.
Non-farm payrolls increased by only 160,000 jobs last month, far below the 202,000 economists had forecast in a Reuters poll. The number was lower than the first-quarter average job growth of 200,000.
“It shows businesses are more concerned about the economic outlook; demand has been soft, so businesses are responding to that,” Ameriprise Financial Services economist Russell Price said in a statement.
Fed under pressure
Concerns over mixed economic data and the slowing pace of global growth have clouded the path of interest rate hikes in the US. The world’s largest economy expanded by just 0.5 percent last quarter on an annualized basis, and inflation has been below the Fed’s 2-percent target for years.
Some market experts cast serious doubts on whether the Federal Reserve would raise interest rates again before the end of the year.
But St. Louis Fed chief James Bullard said another hike was not yet off the table in June when the decision-making panel was due to hold its next meeting. He said everything depended on the economic data still to come until June.
hg/cjc (AFP, Reuters)