The latest employment creation figures for June in the United States revealed a slowdown, but still challenging the effectiveness of the ten consecutive interest rate increases approved thus far by the central bank to control inflation. The Labor Department informed last week 209,000 new jobs were created in June, less than the revised 306,000 created in May, despite interest hikes to over 5 percent, the highest level in 15 years. The unemployment rate decreased from 3.7 percent in May to 3.6 percent in June. Healthcare with 41,000 new jobs, government with 60,000, and construction with 23,000, were the sectors which created more new jobs in June, while retail lost 11,200.
Also in June, average hourly earnings increased 0.4 percent and 4.7 percent from a year earlier, still below the rate of 5 percent in the core consumer price index, which excludes food and fuels and remains far from the central bank’s 2 percent objective.
The Consumer Price Index for June will be the last available before the next meeting of the central bank Open Market Committee, scheduled for July 25-26. If, as expected, the Committee approves another interest rate increase, it may indicate deviating from what the president of the Federal Reserve Bank of Chicago Austan Goolsbee calls “the golden path,” to get inflation down without causing a recession (The New York Times 07|08|23).
