The US Can Thank Its Lucky Stars For Better-Than-Expected Jobs Numbers

The US Can Thank Its Lucky Stars For Better-Than-Expected Jobs Numbers
Paul Allison, CFA

about 1 month ago1 min

What’s going on here?

The US added a lower-than-expected number of jobs in October, a sign that the Federal Reserve’s (the Fed) biggest wish might finally be coming true.

What does this mean?

US companies filled a fewer-than-expected 150,000 jobs in October, while the unemployment rate crept up to just shy of 4%. That’s not a drastic level by any means, but it is the highest number of jobseekers the US has seen this year. But that’s for the greater good: the job market’s clearly weakening without completely collapsing, and that’s the exact outcome the Fed has been praying for.

US jobs

Why should I care?

The bigger picture: Say “ommm”.

The Fed’s been desperately manifesting a calmer economy, but instead of crystals and sound baths, the central bank’s leant on interest rate hikes to make inflation more peaceful. The latest data could well turn some skeptics into believers, especially since pay in the US ticked up by just over 4% between this October and last, the smallest rise in a while. And because wage increases fire up inflation, that news could be the deep breath the economy needed.

US earnings

For markets: Alexa, play “Hot And Cold” by Katy Perry.

Thing is, for every moment of tranquility, there’s a day of madness. Markets have been especially moody this year, and folk are quick to call a Goldilocks scenario – the perfect blend of low inflation and a healthy economy – at the faintest scent of well-cooked oatmeal. But be wary of getting swept up in fairy tales because in this economy, an evil villain can be lurking around any corner. Keep a foot rooted in reality, instead: watch out for reasons why stocks might pick up when they’re down in the dumps, and consider cashing out when everyone’s celebrating.



All the daily investing news and insights you need in one subscription.

Learn More

Disclaimer: These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment advisor.

/3 Your free quarterly content is about to expire. Uncover the biggest trends and opportunities. Subscribe now for 50%. Cancel anytime.

© Finimize Ltd. 2023. 10328011. 280 Bishopsgate, London, EC2M 4AG