Published November 1.  2024 7:20  pm est
by Richard F. Cason,

Richard Fitzgerald Cason, Founder & CEO NEWSMOVESMARKETSFOREX® and Emancipation Financial Wellness Group ™
Editor,
NEWSMOVESMARKETSFOREX ®

 

 KEY TAKE AWAYS:

 

Disappointing Non-Farm Payrolls Highlight Unemployment Disparities, Currency Markets React

The U.S. Bureau of Labor Statistics released its Non-Farm Payroll (NFP) report for October today, revealing a disappointing increase of just 12,000 jobs, leaving the unemployment rate unchanged at 4.1%. 

   The report also indicated significant disparities among different demographic groups, particularly among Black and Hispanic workers, further emphasizing the ongoing challenges in the labor market.
 
The unemployment rate for Black workers stood at 5.7%, while Hispanic workers faced a jobless rate of 5.1%. In contrast, the rates for adult men and women were 3.9% and 3.6%, respectively.
 
These figures reflect a troubling trend, as the overall unemployment rate has remained relatively stable, but certain groups continue to experience higher rates of joblessness.
 
The number of long-term unemployed—those jobless for 27 weeks or more—has also remained elevated at approximately 1.6 million, accounting for 22.9% of all unemployed individuals.

 

Labor Markets

The NFP report also highlighted a decline in manufacturing jobs, which fell by 46,000, largely due to strike activity. Meanwhile, sectors such as health care and government saw job gains, with health care adding 52,000 jobs in October.
 
However, the overall lack of robust job growth raises concerns about the economy’s momentum, particularly in light of recent natural disasters that have impacted the southeastern U.S. In the currency markets, the subdued job growth prompted a swift reaction from traders.

 

Currency Markets Reaction to October NFP Report

The U.S. dollar (USD) weakened against major currencies, with the dollar index declining by 0.9%. The EUR/USD pair surged to a high of 1.0907 as investors recalibrated their expectations regarding the Federal Reserve’s monetary policy direction.
 
The British pound (GBP) also gained ground, rising to 1.2980 against the dollar. Market analysts are closely monitoring these developments, particularly as the weak labor data may lead the Fed to pause or slow its interest rate hikes. “

 

Disparities in Unemployment Rates

The disparities in unemployment rates among different demographic groups highlight ongoing inequalities in the labor market,” said Dr. Lisa Harper, a labor economist. “This, combined with the weaker-than-expected job growth, could influence the Fed’s approach going forward.”
 
With the labor force participation rate remaining stagnant at 62.6%, concerns are mounting about the overall health of the job market.
 
The average hourly earnings rose by 0.4% to $35.46, but the modest increase does little to offset the broader issues facing workers, especially in communities of color.
 
As traders and analysts digest the implications of the NFP report, the focus will remain on how these employment trends affect the overall economic landscape and the potential for further volatility in the Forex market.
 
The disparities in unemployment rates among demographic groups, coupled with the slow job growth, pose significant challenges for policymakers as they navigate the path forward.
 
           

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 Reference:   U.S. Bureau of Labor and Statistics. (2023). Employment Situation Summary Retrieved                     from   https://www.bls.gov/news.release/empsit.nr0.

 

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