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US jobs growth and factory sales slow down | |
(about 2 hours later) | |
US employment rose by 223,000 in June, while the April and May figures were revised down, official figures show. | |
May's figure was revised from a rise of 280,000 jobs to a rise of 254,000, according to the US Labor Department. | May's figure was revised from a rise of 280,000 jobs to a rise of 254,000, according to the US Labor Department. |
Despite the slower growth, the jobless rate fell to 5.3% from 5.5%, but that was in part due to people dropping out of the labour force. | |
Meanwhile, factory orders fell in May by the largest amount in three months, the Commerce Department said. | |
Employment gains in June were made across a number of sectors, particularly business services, health care, retail, financial activities and transportation, the Labor Department said. | Employment gains in June were made across a number of sectors, particularly business services, health care, retail, financial activities and transportation, the Labor Department said. |
'Rebound' | 'Rebound' |
The labour force shrunk by 432,000 in June, following a sharp increase in May. | The labour force shrunk by 432,000 in June, following a sharp increase in May. |
This pushed the labour force participation rate - the percentage of the labour force in employment - down to 62.6%, the lowest rate since 1977. And the 5.3% unemployment is now the lowest since April 2008. | |
"The US economy continues to produce 200,000 plus monthly jobs, confirming that the economy continues to rebound from its disappointing first quarter growth performance," said Mohamed El-Erian, chief economic adviser at Allianz. | "The US economy continues to produce 200,000 plus monthly jobs, confirming that the economy continues to rebound from its disappointing first quarter growth performance," said Mohamed El-Erian, chief economic adviser at Allianz. |
"While this solid but far from great jobs report will raise questions about a September interest rate hike, the Federal Reserve is still likely to hike then absent a big external shock." | "While this solid but far from great jobs report will raise questions about a September interest rate hike, the Federal Reserve is still likely to hike then absent a big external shock." |
'More time' | |
The average monthly increase in employment over the past 12 months has been 250,000. | The average monthly increase in employment over the past 12 months has been 250,000. |
Meanwhile, the Commerce Department said factory orders fell 1% in May from April, when orders contracted by 0.7%. | |
The figure reflected a big fall in demand for commercial aircraft, the department said. But, even excluding this, factory orders were only up by 0.1%. | |
The weaker economic data relieves some of the pressure on the Federal Reserve for an early interest rate rise, which many economists had forecast for September. | |
"If anything, it buys the Fed a little more time before the first rate hike. It puts September a little more in question," said Wilmer Stith, a manager at Wilmington Trust. |