Recent economic data suggests that the government shutdown, which lasted 16 days, had little effect. The United States added the strongest number in jobs in many months, adding 204K in October. This was 84K more than the average estimates made by analysts and showing the increasing inaccuracy from economists. September non-farm payrolls was revised higher from 148K to 163K.
The unemployment rate rose .1 percent to 7.3 percent, but still hovers a five-year low. The non-farm print suggests that employers are beginning to hire for the holiday season, but the key will be whether or not these jobs remain into the spring.
Brian Jones, Societe Generale-NY, believes the labor market is healthier than people may thing, who had the highest forecast of 175K jobs added in a Bloomberg survey. “The government shutdown really didn’t have a material impact on employment,” Jones said.
Retail and factory jobs were the largest gainers. However, the participation in the workforce is troublesome, declining to the lowest levels since 1978.
Canadian employment figures were also better than expected. Canada added 13.2K jobs versus the 11K added in the previous month. The Canadian unemployment rate decreased to 6.9 percent.
Precious metals fell on the news with gold sinking over $20 per troy ounce. US equities to lower, but stable, in the wake of a potential taper by the Federal Reserve.