On March 10, 2017, the US Bureau of Labor Statistics (BLS) released their latest labour market data – Employment Situation Summary – February 2017 – which showed that total non-farm employment from the payroll survey rose by 235,000, which built on the 227,000 net change in January 2016. The unemployment rate fell to 4.7 per cent. The Labour Force also grew strongly as participation rose by 0.1 points. The signs are more positive than a few months ago, even if broader indicators (the U6 measure supplied by the BLS ) suggest caution. Overall, there is a large jobs deficit remaining and previous analysis has shown that the jobs that have been created in the recovery are biased towards low pay. One suspects though that the Federal Reserve Bank will take the chance offered by a stronger monthly result (February) to increase interest rates a notch when it meets this week....
Bill Mitchell – billy blog
US labour market improves and interest rates will rise as a consequence
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia
When the labor market gets better (for workers) it is time to tighten the screws to keep them down.
ReplyDeleteMaybe a Fed planted story from WaPo here giving them an out:
ReplyDeletehttps://twitter.com/dpcrawf/status/841120824513957889
Maybe the Fed's Phillips Curve orthodoxy is trying to vindicate Karl Marx's argument that capitalism tries to keep a reserve army of the unemployed to keep wages low, and profit margins high.
ReplyDeletewell if they are going to try to defend monetarism as a valid theory then they should raise...
ReplyDeleteI say flip a coin whether they raise... ie 50/50...
Matt - You're saying there is a 50/50 probability that the Fed will raise rates by 0.25% on Wednesday?
ReplyDeleteYes... 50% chance.... imo....
ReplyDeleteMatt - Don't make book on that coin toss. Fed funds futures are pricing in a 95% probability that the Fed goes 25bp on Wednesday.
ReplyDeletehttp://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html