US Job Vacancy Creation Exceeded Expectations and Rekindled Debate Over Raising Interest Rates in the Country
Sao Paulo – Data on jobs created in the United States in September, stronger than market expectations, moved markets around the world. In Brazil it has a direct impact on the exchange rate. The dollar reached R$5.22 this morning, an increase of 1%. The American currency also appreciated against currencies such as the pound, the euro and the yen.
According to data released this Friday the 6th by the US Department of Labor, the US economy created 336 thousand jobs in net terms in September. The result far exceeded the expectations of the analysts interviewed Screenings broadcastwhich expected the creation of between 140 thousand and 250 thousand jobs, with a median of 175 thousand.
For analysts, this data also demonstrates the resilience of the American economy, which increases the chances of a new interest rate rise in the USA, even if the majority still bets on maintaining rates for some time.
In Brazil there is the possibility that American interest rates will rise again entered the market radarwhich discusses what impact this will have on the Selic fall cycle.
For Fabrizio Velloni, chief economist at Fronte Corretora, signs of strong job creation in September and strong upward revisions of August and July data in the United States could inhibit growth Selic rate reduced by 0.50 percentage points in the next meetings, upon appointment by the Central Bank. This is because interest rates on American bonds and the dollar abroad have recovered, increasing the rate of devaluation of the real.
“Payroll (US labor market data) reduces the CB’s room for maneuver in reducing the Selic rate and the prospect of a smaller differential in internal and external interest rates could fuel capital flight from Brazil,” says the economist.
However, Velloni notes that average hourly wages increased by 4.15% year-on-year, slightly below expectations (4.30%), and the unemployment rate increased slightly, to 3.8%, compared to expectations. forecasts of 3.7%. “The reduction in wages indicates that new hires are being made at lower incomes, because there must be more demand for jobs than vacancies, which raises suspicions about the large increase in job creation indicated by last month’s payrolls “, he said. / Sergio Caldas and Silvana Rocha
Source: Terra
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