Washington: According to official reports, US job growth decelerated in June, yet the economy still generated more positions than anticipated. Employers added 206,000 jobs, while May's job creation figures were revised down from 272,000 to 218,000.
As per reports, the unemployment rate inched up to 4.1 percent, and wage growth rose at its slowest pace in three years. Analysts suggest these numbers may prompt the Federal Reserve to consider cutting rates later this year. Economists had predicted a job increase of 190,000 for June.
Emily Bowerstock Hill, CEO of Bowerstock Capital Partners, described the data as "relatively benign," noting that it isn't alarming enough to unsettle markets or cause concern for the Fed. She mentioned that the Fed has signaled an expected rate cut within the year.
US interest rates remained steady at 5.25%-5.5% in June, a range maintained since July of the previous year. Minutes from the Fed's recent meeting, released on Wednesday, acknowledged signs of a slowing economy and diminishing price pressures.
Financial markets currently estimate a 72 percent probability of a rate cut during the Fed's September meeting, with a growing chance of a second cut in December. Despite initial forecasts in March predicting a significant reduction in rates this year, the Fed's outlook shifted in June to a single quarter-point cut, due to persistent price increases and robust job market indicators.
While central banks globally often follow the Fed's lead in adjusting rates, Bank of England Governor Andrew Bailey stated in May that "there is no law that the Fed has to go first."
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