• MTS Economic News_20160808

    8 Aug 2016 | Economic News

 

The dollar was up 0.3 percent at 102.07 yen JPY=. It was steady against the euro at $1.1085 EUR=.


The dollar index, which tracks the greenback against a basket of six major rivals, was 0.1 percent higher at 96.295 .DXY, not far from a one-week high of 96.522 hit on Friday after the jobs report.


U.S. employment rose more than expected for the second month in a row in July and wages picked up, bolstering expectations of faster economic growth, and raising the probability of a Federal Reserve interest rate increase this year.


Nonfarm payrolls rose by 255,000 jobs after an upwardly revised 292,000 surge in June, with hiring broadly based across the sectors of the economy, the Labor Department said on Friday. In addition, 18,000 more jobs were created in May and June than previously reported.


Economists polled by Reuters had forecast payrolls increasing 180,000 in July and the unemployment rate dipping one-tenth of a percentage point to 4.8 percent.


The unemployment rate was unchanged at 4.9 percent as more people entered the labor market.


Highlighting job market strength, average hourly earnings increased a healthy eight cents and are up 2.6 percent year on year, while workers put in more hours.


"The July jobs report was everything you could have asked for and more. Provided the strength in jobs is confirmed with other economic data, the Fed will have sufficient reason to hike (rates) this year," said Michelle Meyer, a senior economist at Bank of America Merrill Lynch in New York.


After Friday's data, Fed futures contracts were pricing in about a 46 percent chance of a rate hike by the end of this year, up from about 34 percent.


However, more top Wall Street banks now expect the Federal Reserve to raise U.S. interest rates in 2016 after Friday's jobs report, a Reuters poll conducted on Friday showed.


Three of the banks polled said the Fed would raise rates at its Sept. 20-21 meeting, a slight shift from a month ago when none thought the Fed would make such a move.


"December is definitely in play," said Justin Lederer, Treasury strategist at Cantor Fitzgerald, one of the 23 primary dealers, in New York.


Oil prices dipped slightly in New York on Friday as the US dollar rose on exchange markets following robust hiring numbers from the US government.


On the New York Mercantile Exchange, a barrel of West Texas Intermediate benchmark crude for delivery next month fell US$0.13 to close at US$41.80.


In London, North Sea Brent for October delivery fell US$0.02 to US$44.27 a barrel on the Intercontinental Exchange.


Reference: Reuters, Taipeitimes


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