Investing.com – The U.S monthly employment report showed that the economy created more jobs than forecast in July, while the unemployment rate and month-on-month wage inflation came out in line with expectations, according to official data released on Friday.
Non-farm payrolls (NFP) rose 209,000 in July, compared to the rise of 231,000 a month earlier that was revised up from the initial increase of 222,000. The data beat the consensus estimate for the creation of 183,000 jobs.
The jobless rate decreased as expected to 4.3%, from the prior 4.4%.
Average hourly earnings rose month-on-month by 0.3% in July, in line with forecasts and compared to the prior 0.2% advance.
On an annualized basis, wage inflation rose 2.5% in July, in line with the prior reading but slightly above forecasts for a 2.4% year-on-year advance.
The increase in wages is being closely monitored by the Federal Reserve for evidence of diminishing slack in the labor market and upward pressure on inflation. Economists generally consider an increase of 3.0% or more to be consistent with rising inflation.
Additionally, the private sector created more of the new job contracts than expected in July with a total of 205,000, compared to consensus expectations for 178,000. June’s number was revised up to 194,000 private nonfarm payrolls, from the prior reading of 187,000.
Government payrolls increased by 4,000 last month, compared to the 37,000 public jobs created in June, revised from an initial increase of 35,000 positions.
The participation rate ticked up to 62.9% in July from the previous reading of 62.8%.
The U-6 unemployment rate, that includes those workers who are working part-time for purely economic reasons, remained unchanged at 8.6% last month.
Furthermore, the average weekly hours also held steady as expected at 34.5 in July.
After the release, which was published simultaneously with the June trade balance, the dollar reacted to the upside. The U.S. Dollar Index traded at 92.94, compared to 92.68 earlier. EUR/USD traded at 1.1837, from 1.1869 before the publication, USD/JPY traded at 110.60, from 110.09 earlier, and GBP/USD was at 1.3101, compared to 1.3144 previously.
U.S. futures pointed to a higher open on Wall Street. The blue-chip Dow futures gained 0.25%, S&P 500 futures rose 0.14% while the Nasdaq 100 futures traded up 0.20%.
Elsewhere, in the commodities market, gold futures traded at $1,262.00 a troy ounce, compared to $1,268.43 ahead of the data, while crude oil traded at $48.91 a barrel from $48.88 earlier.