U.S. firms recruited more people than expected March and raised wages, suggesting the economy closed the first quarter strong and delaying Federal Reserve interest rate decreases this year.
The Bureau of Labor Statistics' carefully watched employment report on Friday showed 303,000 nonfarm payroll jobs gained last month. February job growth was revised down to 270,000 from 275,000.
STOCKS: S&P 500 e-mini futures predicted a higher Wall Street open. BONDS: 10-year Treasury yields jumped 8.9 basis points to 4.398%; 2-year yields rose 7.2 basis points to 4.7127%. FOREX: Dollar index increased 0.4% to 104.65
The payrolls figure is high, surpassing estimates and the previous month. It proves this economy is strong. A healthy economy reduces the Fed's need to lower interest rates, as witnessed in the stock market in recent weeks. Fed rhetoric has been more 'hawkish,' suggesting they are not lowering rates quickly. It's smart. They store ammunition for emergencies."
"While we still consider non-farm payroll the most crucial indicator every month, inflation takes precedence. The number of monthly jobs this economy can create entering the year continues to astonish us."
"Unemployment stays below 4% and earnings rise 4.1% year-over-year, which is fantastic news. Wages are rising less than last year, which is positive. The main message from this jobs data is that there's no inflationary pressure."
The Fed's second-half interest rate cut may be complicated by this week's data, notably the employment report. After a stronger-than-expected employment report, manufacturing data, and a rising services economy, June expectations have dropped. So the economy is booming."
"As you've seen in the rate markets and the stock market, investors are readjusting to the possibility that we won't have three rate cuts this year. It may be two, and I think it's too soon to inform her." "If the economy continues like it is through most of the year, the Fed may not decrease interest rates. That will alter investor expectations."
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