Daily Archives: August 2, 2013

By James Politi in Washington

Capping a week flooded with US economic data, July’s job figures are out. So, what did we learn this time around?

 


1) A mixed bag but the jobs report could favour a later taper

Federal Reserve officials hoping that the July jobs report would provide a decisive answer to their dilemma over when to start tapering the asset purchases are likely to have been sorely disappointed.
The data were a classic mixed bag – with the unemployment rate dropping 0.2 percentage points from 7.6 per cent to 7.4 per cent but payroll growth slowed, running below expectations.
But on the margins, the data are likely to offer proponents of a later taper just a bit more ammunition than supporters of an early taper. The Fed is likely to give more weight to the weaker payrolls “establishment” survey than the stronger but more volatile household survey, which measures joblessness.
The question for fans of slowing down asset purchases at the FOMC’s next meeting on September 17-18 is whether a slight slowing in job creation is sufficient to deter them, and it may not be. And luckily for FOMC members, they still have more than six weeks of data – including another jobs report – to make up their minds.