U.S Non-Farm Payrolls Surprisingly Less at 96K, Unemployment Rate Drops to 8.1% - 7.9.2012
The US economy added 96,000 new jobs in August excluding the farming sector, lower from a revised 141,000 increase in July according to the US Bureau of Economic Analysis. Market participants were expecting Non-Farm Payrolls for August to increase by 125,000 however the release was worse for the U.S labor market. At the same time, the Unemployment Rate for August fell unexpectedly by 20 basis points to 8.1 per cent due to decreasing number of persons that are searching for work, reducing labor force.
Weaker data for the Non-Farm Payrolls could set pressure on consumer spending and demand, major drivers of economic growth. Additionally the possibility of new monetary easing by the FED is increasing and that is pushing the US dollar value lower. The greenback extended losses against its major peers, the US dollar index fell after the NFP release from 81.08 to 80.49.