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US labor market supports case for rate hike - BNP

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 12, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    Analysts at BNP Paribas explained that yhe labour market conditions clearly support another rate increase.

    Key Quotes:

    "In January, the unemployment rate dropped below 5% (to 4.9%) and wage growth was relatively strong (+0.3% for production and non-supervisory employees).

    Contrasting with survey data, the manufacturing sector not only added jobs (+29kfor the month), but also the number of hours worked increased.

    The upturn in the index of aggregated hours in January (+0.5%) could foreshadow a rebound in manufacturing activity.

    Two factors lend credibility to this hypothesis: the strong increase in overtime work (+2.4%) and the “new orders” component of the ISM index (+2.7 points to 51.5, the highest score since summer 2015)."
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