4 August 2023
If you are covering the latest US employment statistics, please see the following comment from David Henry, investment manager at Quilter Cheviot:
“The US jobs market continues to remain remarkably resilient in the face of the highest Fed Funds Rate in a generation, while simultaneously offering signs that the Federal Reserve’s fight against inflation is making progress. 187,000 jobs were added in July, lower than expectations but still a relatively robust figure, marking a fall from 209,000 in June and the lowest level seen since 2020. The unemployment rate also saw a minor downtick to 3.5%.
“While the labour market is slowly cooling as rate rises have some impact, at the moment there still seems to be enough momentum in the economy to avoid recession. Whisper it, but the fabled ‘soft landing’ may just be achieved, although a lot can still happen before the Fed declares “job done”. The economy’s robustness may mean that the Fed feels comfortable continuing to raise rates, but it has repeatedly stated that these decisions will remain dependant on the data and there are a number of data points due before the next meeting - not least next week’s inflation number.
“The US remains the powerhouse of the global economy, with significant opportunities for investors. With labour market growth slowing but still strong, economic growth holding up and consumer spending still high, the region remains very attractive.”
