US nonfarm payroll data for December fell short of expectations, and a slight decrease in the unemployment rate could not mask the deteriorating trend in the labor market.
PANews reported on January 9th that, according to Jinshi News, data released by the U.S. Bureau of Labor Statistics on Friday showed that 50,000 jobs were added in December, lower than economists' forecasts of 60,000. The unemployment rate fell to 4.4%, compared to 4.6% in November. This data provides the most complete picture of the U.S. job market in months, after the November and October data were severely impacted by the government shutdown. The November job increase figure was revised down to 56,000 from an initial estimate of 64,000. This data release further confirms signs of a deteriorating labor market, impacted by federal government workforce cuts and a slowdown in private sector hiring. The Federal Reserve has lowered U.S. borrowing costs at its last three meetings, maintaining its benchmark target rate range at a three-year low of 3.5-3.75%. Fed Chair Powell hinted in December that the threshold for further rate cuts was high, stating that current borrowing costs were "in a good place." However, the weak December data may complicate the Fed's case for pausing its rate-cutting cycle at its next meeting later this month. The Federal Reserve also expressed concerns about the accuracy of recent data from the Bureau of Labor Statistics. Powell believes that the U.S. economy is adding 60,000 fewer jobs per month than the employment report claims.
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