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| Photo Credit: AP. |
U.S. economy added 315,000 jobs in August, the Washington Examiner cited a report by the Bureau of Labor Statistics Friday morning. The cheering news was an indication that the US economy may not be doing too badly in the face of soaring inflation and low consumer confidence as a result of continuing interest rate hikes by the Federal Reserve.
That notwithstanding,
the consumer confidence increased in August after more than four months. The move
by the Federal Reserve has increased the cost of doing business which could
hurt investments and inevitably hurt the economy in the long run.
The unemployment
rate rose two tenths of a percentage point to 3.7%, according to the Washington
Examiner. The increase in joblessness may have been indicated by a jump in the
size of the labor force in the month, which also includes new job seekers who
were newly counted among the unemployed, the Washington Examiner reported.
The U.S. has
experienced months of strong job gains averaging 378,000 over the past three
months but the news of rise in employment is a concern to the Biden administration
which continues to tout strong job reports a key indicator of how well his
economic policies has worked.
White House
economists have cited the job report as indication the country was not in
recession. The economy has regained the employment level at the time of the
COVID-19 travails.
In the
second quarter, the GDP fell at a 0.6% annualized rate, the Washington Examiner
cited a revised estimate from the Bureau of Economic Analysis last month.
The GDP have
declined two straight streaks – which may qualify for the definition of
recession.
The National
Bureau of Economic Research, a private academic group defines a recession as “a
significant decline in economic activity that is spread across the economy and
that lasts more than a few months.”
In July the
Federal Reserve hiked the nation’s interest rate by three-quarters of a percent
in a bid to stem soaring inflation, increasing fears of possible recession.
The Fed
noted that ongoing increases in its target range “will be appropriate” in the
months ahead.
Such hikes
in interest rates would result in increases in rates for home mortgages and
other consumer loans, according to The Washington Times.
U.S.
inflation figures released early July rose to about 11.3% as measured by
producer wholesale prices for the month of June 2022, according to a report
from the Bureau of Labor Statistics.
The housing
market has slowed dramatically following the rates hikes. In July new home
sales plummeted from the month before, dropping to 12.6% last month to a
seasonally adjusted annual rate of 511,000 – the lowest level since January
2016, according to the Washington Examiner.
Existing home sales also suffered a 5.9% drop in July, a sixth straight month of decline, the Washington Examiner cited a report from the National Association of Realtors.