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Peter Davis

An writer at FOMOdrive

  • Nov 03, 2023
  • 3 min read

The dollar fell after the news from the US

On Friday, US labor market data was released, causing the dollar to drop significantly.

In October, the amount of new jobs created was not as high as anticipated.

The data from the previous two months was significantly revised downwards.

Unexpectedly, the unemployment rate has reached its highest point in nearly two years.

The dollar index dipped to its lowest level in approximately one-and-a-half months, reaching 105.1.

On Friday, the US Bureau of Labor Statistics reported that US nonfarm payrolls increased by 150,000 in October, which was lower than the expected 180,000 new jobs. Additionally, the data for the previous month was revised to a decrease of 39,000.

In October, the unemployment rate unexpectedly increased by 0.1%, reaching 3.9%, which is the highest it has been since January 2022. This was unexpected, as no change was anticipated.

The monthly growth of average wages, a significant measure of inflation, was worse than anticipated. Average hourly wages increased by 0.2% from the preceding month, which was lower than the predicted +0.3% m/m.

Average salaries grew by 4.1% annually, which was slightly better than expected, but the published data was still not encouraging.

In October, the private non-agricultural sector saw an increase of 99 thousand jobs, which was much lower than the expected 158 thousand. Manufacturing jobs decreased by 11 thousand, mainly due to the UAW strike against Ford, Stellantis and General Motors. On the other hand, public sector employment rose by 51 thousand jobs.

Foxbusiness reported that U.S. job growth in October was weaker than anticipated, indicating that the labor market is beginning to weaken due to higher interest rates, sustained inflation, and other economic uncertainties.

A sharp decrease in the rate of job growth was also noted in the report. The figures for August and September were revised to 165 thousand and 297 thousand jobs, respectively, which is a decrease of 101 thousand jobs in total.

ManpowerGroup has observed that the winter chill is having an effect on the job market. Both employers and employees are bracing themselves for the colder months, and hiring levels are becoming more consistent.

Economists are of the opinion that the Federal Reserve has concluded its tightening policy, however, Jerome Powell, the Fed Chairman, cautioned on Wednesday that any "strains in the labor market" could be a source of worry.

The probability of the Fed rate staying the same at the December meeting rose to 90.4% from 80.2% the day prior; and for the January meeting, it increased to 82.9% from 71.9% the day before.

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