The Day at a Glance | September 2 2022

The Top

*Job creation in the United States slows down; the unemployment rate increased to 3.7%.

*Inflation for producers in Europe increased more than expected (37.9% annual, July).

*Food prices decreased for a fifth consecutive month in August (-1.9% monthly), according to United Nations indicators.

*Growth in the US manufacturing sector remains stable, according to the ISM (52.8).

*Russia announced that it will stop selling crude oil to countries that implement price ceilings – as proposed by the G7.

Economic environment

United States labor market. August`s employment data in the United States economy logged the creation of 315 thousand new jobs, in line with the 300 thousand average estimated by analysts. This represents a substantial slowdown in job creation with respect to July – figure that was revised downwards (526 thousand). The largest gains in employment were seen in professional services, health services and retailing. The unemployment rate surprised to the upside and increased to 3.7% (vs 3.5%e.). The rise in the unemployment rate is related to the increase in the participation rate (people that are actively looking for a job in the labor market), which increased to 62.4%. Lastly, wages increased less than expected at a 5.2% annual pace (vs 5.3%e.), which represents stabilization with respect to its recent upwards trend. The data made public this morning is a sign of relief for the FED and markets as the labor market starts to show signs of weakness, necessary to see a moderation in inflation in the medium term. The figures back a less aggressive stance on behalf of the FED in the future and will turn into a favorable argument for a 50bp increase in September; although the monetary policy decision is still led by uncertainty. August`s inflationary data is yet to be made known on September 13^th, which will give the FED crucial information for it to make its decision.