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US jobs report disappoints
May 6, 2016, 1:39 pm

The Labor Department's report showed a significant drop in jobs created in April, far below forecasts [Xinhua]

The Labor Department’s report showed a significant drop in jobs created in April, far below forecasts [Xinhua]

Markets in emerging economies took the worst beating in three months Thursday as the US dollar continued its three-day spike against major currencies and amid fears that the US Fed will assess business conditions favorable enough to raise interest rates later this year.

But on Friday, the report released by the US Labor Department showed that the economy added only 160,000 jobs in April, far less than market forecasts and more than 20 per cent lower than March figures of 208,000.

Unemployment remained steady at five per cent, however.

Although some in the media have predicted that the US Federal Reserve’s Open Market Committee (FOMC) would decide during a June meeting to raise interest rates, market realities may spur caution instead.

The same report on Friday indicated that the Labor Department revised its statistics for job creation during February and March downward by a total of 19,000.

The US economy grew by only 0.5 per cent in Q1 in 2016. Compare that to 1.4 per cent in Q4 2015.

The worse-than-expected jobs report gave some reprieve to emerging market currencies.

The South African rand, which had hit 15.08 to the dollar ahead of the release of the jobs report early on Friday, regained some traction at press time to 14.99.

The Russian ruble and the Brazilian real had also suffered losses this week.

Back in the US, the S&P 500 opened down 0.2 per cent at opening bell while the NASDAQ fell 0.18 per cent.

The Dow Jones Industrial Average rose 0.05 at opening Friday.

US oil benchmark West Texas Intermediate was down 1.13 per cent to $43.82 a barrel; international benchmark Brent Crude was down 1.27 per cent to $44.44 a barrel.

The BRICS Post with inputs from Agencies

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