Investing.com – The U.S monthly employment report showed that the economy created fewer jobs than forecast in August, the unemployment rate unexpected ticked up and wage inflation slipped more than expected, according to official data released on Friday.
Non-farm payrolls (NFP) rose 156,000 in August, compared to the rise of 189,000 a month earlier that was revised down from the initial increase of 209,000. The data missed the consensus estimate for the creation of 180,000 jobs.
The jobless rate unexpectedly rose to 4.4% last month. Economists had expected no change from July’s reading of 4.3%.
Average hourly earnings rose month-on-month by 0.1% in July, below forecasts for a gain of 0.2% and compared to the prior 0.3% advance.
On an annualized basis, wage inflation rose 2.5% in August, matching forecasts and the prior month’s advance.
The increase in wages is being closely monitored by the Federal Reserve for evidence of diminishing slack in the labor market and upward pressure on inflation. Economists generally consider an increase of 3.0% or more to be consistent with rising inflation.
Additionally, the private sector created fewer of the new job contracts than expected in August with a total of 165,000, compared to consensus expectations for 179,000. July’s number was revised down to 202,000 private nonfarm payrolls, from the prior reading of 205,000.
Government payrolls declined by 9,000 last month, compared to the 13,000 public jobs destroyed in July, revised from an initial increase of 4,000 positions.
The participation rate remained stable at 62.9% in August.
The U-6 unemployment rate, that includes those workers who are working part-time for purely economic reasons, also held steady at 8.6% last month.
Furthermore, the average weekly hours ticked down to 34.4 in August from the prior month’s reading of 34.5. Analysts had expected no change.
After the release, the U.S. Dollar Index traded at 92.21, compared to 92.53 earlier. EUR/USD traded at 1.1961, from 1.1918 before the publication, USD/JPY traded at 109.72, from 110.12 earlier, and GBP/USD was at 1.2982, compared to 1.2943 previously.
U.S. futures pointed to a higher open on Wall Street. The blue-chip Dow futures gained 60 points, or 0.27%, S&P 500 futures rose 6 points, or 0.24% while the Nasdaq 100 futures traded up 22 points, or 0.37%.
Elsewhere, in the commodities market, gold futures traded at $1,331.06 a troy ounce, compared to $1,324.35 ahead of the data, while crude oil traded at $47.11 a barrel from $47.09 earlier.