US Bureau of Labor Statistics reported that the economy created 2.5 million new jobs in May, which sharply contrasts with the expected slump by 7.5 million. This massive gap between expectations and fact shows how much the economic analysts underestimate how fast the economy can turn from contraction. We saw the same in China earlier in March.
US Dollar got a chance to rebound after a long losing streak of decline to major rivals. NASDAQ jumped to an all-time high at 9780, and Dow Jones surpassed the 27K milestone. Elsewhere in commodities, Gold is losing 2.4%, while Crude oil is adding 5.5% so far today.
The return to normal must occur not only in the number of people receiving a wage. The participation rate jumped, while average weekly hours reached a record 34.7. Even a drop in average earnings is a good sign as it reflects the return to work of low-paid employees. The same can be seen across the financial markets.
America turns back to a more normal life. But the question remains, will it come to living fully in the coming months? Now the US employment is 19.5 million or 13% below the February peak. The total weekly payrolls are 10% lower than at their heigh, which is temporarily offset by checks from Trump and various programs. But most of these measures are short-term, if not just one-time.
Turning to financial markets, one should take care of possible pullbacks of stocks in the coming days as stocks look overbought, and this often leads to correction on the first signs that a rally stalls.
The FxPro Analyst Team
This Review is presented by FxPro.
For all Articles related to Fxpro please click here