US job growth beats expectations as US dollar dips
The US created 213,000 jobs last month with official figures proving far stronger than expected, although unemployment also climbed 0.2 per cent.
The closely-watched non-farm payroll report exceeded forecasts of 195,000 new jobs in June, with job growth in healthcare and manufacturing industries trumping employment loses in retail trade.
However, the US dollar fell as much as 0.3 per cent following flat average earning results, with the pound edgeding up against the dollar to $1.3269.
Year-on-year wage growth remained unchanged at 2.7 per cent and narrowly below projections of 2.8 per cent.
Unemployment levels also rose from 3.8 per cent to four per cent, climbing by 499,000 to 6.6m.
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Jacob Deppe, head of trading at online trading platform Infinox, said: “Despite what is a solid jobs report overall, the rise in America’s unemployment rate and the slowing pace of wage growth will do nothing to persuade the Fed to bring forward its next rate hike.”
Deppe added: “Against that backdrop, the Greenback is continuing its post-4th July slump and heading into the weekend down against a comparatively perky Pound and a recovering Euro.”
Figures for April and May were also revised upwards, showing 37,000 more jobs were created in these months than previously forecasted.
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Aberdeen Standard Investments senior global economist James McCann said: “These numbers provide further evidence of an economy in rude health. The interesting wrinkle in the report is what it might say about spare capacity and the required pace of future rate rises.”
McCann added: “Wage growth is a bit softer than seen over recent months and higher participation has pushed the unemployment rate up. This raises the question of how much slack is still left in the labour market.”
Employment-to-population ratio remained steady at 60.4 per cent, tied for the highest level since early 2009.
The results come only hours after the escalation of a tit-for-tat tariff war between Washington and Beijing, in which both sides imposed $34bn (£25.6bn) worth of import duties on the other.