US ADP Non-Farm Employment Change Released Beyond Expectation

EarnOnVictor

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Quote from: hugeblack on July 06, 2023, 09:26:35 AM

Therefore, unless we witness a fixation of interest rates for a long time or start to reduce them, all indicators now may give Inaccurate numbers eventually lead to an urgent hike in interest rates, which could lead to a violent recession.

Inflation forced the Federal Reserve to take drastic measures on the rate hike since late 2021 and was more aggressive in 2022 until the beginning of this year. I believe they would do the needful as they carefully study the path inflation is following in recent months. They've halted the rate hike now which is a good development, thanks to the recent stance on inflation.

The last released figure of the Core PCE Price Index m/m which is the primary inflation measure of the Federal Reserve was 0.3%, a value which is 0.1% lower than the value released in the preceding month.

Also, the figures and chart representation below show a good extent to which inflation is fast dropping in months (y/y).

If it continues like this, then there can't be any reason for the FED to raise the hike anymore, but would on the contrary be getting prepared to cut rates, which is the standard practice in such a situation.

Quote from: adaseb on July 08, 2023, 12:11:24 AM

Quote from: jacafbiz on July 07, 2023, 02:36:47 PM

I know data in US is better than most of the countries both the western and those in the west, but I don't take these data serious because most of the time they have been cooked and padded to show that the Government is working, and the economy is doing well and in actual sense the reverse is the case. It is better to look beyond all these conventional data to see the true picture of how the economy is doing

This data seems positive however right now we don’t want extremely low unemployment figures. Why? Because it will lead to inflation and higher rates.

I guess you are missing something here, positive data can't unnecessarily cause inflation and rate hikes. And I have never heard of a situation where good employment figures are bad for a country's economy.

Gyfts

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Quote from: adaseb on July 08, 2023, 12:11:24 AM

Quote from: jacafbiz on July 07, 2023, 02:36:47 PM

I know data in US is better than most of the countries both the western and those in the west, but I don't take these data serious because most of the time they have been cooked and padded to show that the Government is working, and the economy is doing well and in actual sense the reverse is the case. It is better to look beyond all these conventional data to see the true picture of how the economy is doing

This data seems positive however right now we don’t want extremely low unemployment figures. Why? Because it will lead to inflation and higher rates.

When someone has trouble finding employees they need to pay them more. By paying them more they increase their prices and drive inflation even higher and the cycle repeats.
Hence why this is not a good release and means that we will get at least 2 more rate hikes.

If there's a low unemployment rate, then wages wouldn't need to increase in order for employees to be retained. The federal reserve had blamed employee wage increases as a core driver of inflation. Employers were paying their employees more, and were forced to raise prices of goods/services. But the unemployment rate wasn't actually the core of the issue. The unemployment rate in 2020-2022 was higher than what it needed to be with pandemic era stimulus money. People were more reluctant to go back to work, and employers essentially had to compete with the federal government in retaining employees.

With the recession fears, I'd gladly look for a low unemployment rate. If the U.S. enters recession, other economies and markets begin to slow.

adaseb

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Quote from: jacafbiz on July 07, 2023, 02:36:47 PM

I know data in US is better than most of the countries both the western and those in the west, but I don't take these data serious because most of the time they have been cooked and padded to show that the Government is working, and the economy is doing well and in actual sense the reverse is the case. It is better to look beyond all these conventional data to see the true picture of how the economy is doing

This data seems positive however right now we don’t want extremely low unemployment figures. Why? Because it will lead to inflation and higher rates.

When someone has trouble finding employees they need to pay them more. By paying them more they increase their prices and drive inflation even higher and the cycle repeats.
Hence why this is not a good release and means that we will get at least 2 more rate hikes.

jacafbiz

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I know data in US is better than most of the countries both the western and those in the west, but I don't take these data serious because most of the time they have been cooked and padded to show that the Government is working, and the economy is doing well and in actual sense the reverse is the case. It is better to look beyond all these conventional data to see the true picture of how the economy is doing

Faisal2202

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Quote from: EarnOnVictor on July 06, 2023, 08:02:40 AM

Frankly, this kind of growth is uncommon and explains why Bitcoin sold sharply in case this is not obvious to some people. Coupled with a reduced threat from Inflation which I've been studying since last year and better Retail sales to date, I believe that the US is getting out of the woods faster than expected.

The measures by the US government and FOMC that many criticised are now yielding good results.

If I also speak frankly then I totally agreed with your concerns because I thought the same. They were just creating some fear among investors and every institute. Why? In the context of crypto they want to create fud and fear in the market which they definitely has made.

Like, the prices went down due to debt ceiling, and inflation issue, which frankly speaking, looks like an artificial efforts to make one. Because k as mentioned, they just wanted to create fear in the market. And once the inflation and debt ceiling trick has been done they forced centralized exchanges to move out of the competition by suing them (you better knows then me) so that they could come up with their own product to fill the gap.

This would made them huge profits which is obviously what they wanted. At that time many analysis said this is all just did and fear this will pass away and US inflation is not that a big issue because the economy of US is so strong but as we all know that at that time prices of the US dollar was also high which had benefited those who hold in US dollars.

At the end,/everything seems to be a pre-plan but I might be wrong or being too much skeptical. So let'a see what's the conditions now and will be in future about crypto.

MusaMohamed

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Quote from: hugeblack on July 06, 2023, 09:26:35 AM

One of the main indicators of the Fed's rate decisions affecting a recession is the Core Personal Consumption Expenditure (PCE) Price Index and Core CPI for May which released higher at 5.3%.

source

FED have their data but we have some sources to use and think of plans of FED.

Like Truflation.com with data for CPI and some categories.
https://truflation.com/
https://truflation.com/methodology

hugeblack

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One of the main indicators of the Fed's rate decisions affecting a recession is the Core Personal Consumption Expenditure (PCE) Price Index and Core CPI for May which released higher at 5.3%.

source

it is true that we have come out of the bottleneck, but there is still importance for “core” inflation (lack of food and energy), which may inevitably affect the ADP non-agricultural employment report. Therefore, unless we witness a fixation of interest rates for a long time or start to reduce them, all indicators now may give Inaccurate numbers eventually lead to an urgent hike in interest rates, which could lead to a violent recession.

EarnOnVictor

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The US economy is fast recovering, and what happened today where the much appreciated ADP Non-Farm Employment Change was released far more positively than expected is a good sign that the US economy can't slip into recession anymore as widely thought.

The employment change was expected at 226K by the economist which should have been a 41K reduction from the last recorded value of 267K. But instead was released more than double the expectation as it was released at 497K, a value even almost double the former figure.

Frankly, this kind of growth is uncommon and explains why Bitcoin sold sharply in case this is not obvious to some people. Coupled with a reduced threat from Inflation which I've been studying since last year and better Retail sales to date, I believe that the US is getting out of the woods faster than expected.

The measures by the US government and FOMC that many criticised are now yielding good results.

Note: Time is in GMT+1

Topic: US ADP Non-Farm Employment Change Released Beyond Expectation (Read 111 times)