US jobs growth failed to live up to expectations, after non-farm payroll figures released today showed the number of job openings rose 215,000 in July, falling short of forecasts.
Experts were predicting jobs growth of 223,000 according to a Reuters poll, and the dollar initially dropped steeply following the news, but quickly bounced back to trade 0.3 per cent up against the euro, as traders increased their bets on a rate hike from the Federal Reserve.
Chris Williamson, economist at Markit commented that despite coming in shy of forecasts, the July figures were "yet another solid employment report", leaving a rate rise still likely:
Today’s report does nothing to discourage the belief that a September hike is very much on the table, albeit by no means a done deal.
The US dollar was holding steady ahead of the jobs report, having risen against the euro earlier this week to trade at 1.093.
Employment figures will be a key factor in the Federal Reserve’s decision on whether or not to raise interest rates later this autumn, with chair Janet Yellen close to pulling the trigger on a hike, which would be the first in close to a decade.
Yellen recently said that US interest rates should rise before the year is out.
Despite the latest jobs figures falling short of expectations, a hike seems likely according to optimistic traders who increased their bets on interest rates increasing in September after figures were released.
Last month the Federal Reserve upgraded to a more positive assessment of the labour market as it continued to “improve, with solid job gains and declining unemployment”.
Unemployment held steady at 5.3 per cent, the lowest figure since the financial crisis.
The latest figures come just days after the ADP National Employment Report showed US jobs growth slowing to 185,000 in July, the smallest increase since April.