The Day at a Glance | February 8 2023

*Last week`s employment report surprise indicates that efforts to reduce inflation will last longer than previously expected, according to the Chair of the Federal Reserve.

*According to the Mexican Social Security Institute, 111,699 jobs were created in January, which is a 0.52% monthly increase (3.48% annual) and led to a total 21.44 million.

*In the US, the Mortgage Bankers Association informed that mortgage applications increased 7.4% in the week ending February 3rd. Additionally, the 30-year fixed rate average decreased to 6.18%. 

Economic environment

The fight against inflation will “take quite a bit of time”, according to Chair of the Federal Reserve, Jerome Powell. At the Economic Club of Washington, D.C., Powell acknowledged that interest rates could increase more than initially expected (without specifying any figures) due to risks that the labor market`s strength poses to reaching a 2.0% rate of inflation; a process that has just begun and will probably take a year to achieve. The FED`s Chair added that wage revisions are becoming more moderate, and that the economy may even “cool down” despite the current increase in employment. With this, Powell stated that the FED`s officials are open to shocks in both directions regarding inflation.