Unemployment Rate in the US Increases in June
In June, the unemployment rate in the US increased slightly to 4.1%, while the number of jobs created by American employers was lower than in May, raising the chances of a monetary policy relaxation decision by the Federal Reserve, according to Reuters.
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The report published by the Department of Labor shows that the American economy added 206,000 jobs last month, fewer than the 218,000 jobs created in May but above analysts’ expectations interviewed by Reuters, who were expecting around 190,000 new jobs, as reported by Agerpres.
Furthermore, the unemployment rate increased by 0.1 percentage points to 4.1%, while analysts had expected it to remain stable at 4%. Unemployment rate data, released on the first Friday of each month, are closely monitored by both Wall Street financial markets, anticipating interest rate cuts, and Washington authorities, as the labor market situation is one of the few strong points of the Biden Administration.
The Federal Reserve (Fed) uses unemployment and inflation data, which are expected to be released on July 11, to determine if the American economy is slowing down and is ready for a reduction in the policy interest rate. At the June monetary policy meeting, Fed officials kept the base rate unchanged in the range of 5.25% – 5.5%. Recently, the President of the Federal Reserve, Jerome
Powell Emphasizes Need for More Data Before Considering Interest Rate Cuts
During a recent statement, Powell mentioned that the US Central Bank still requires more data before considering reducing interest rates. This cautious approach aims to ensure that the latest information indicating a slowdown in inflation provides an accurate picture of what is happening with pricing pressures.
The next meeting of the Federal Reserve’s monetary policy committee is scheduled for July 30-31.
