U.S. job growth slows sharply, unemployment rate falls to 4.5 percent
U.S. employers added the fewest number of workers in 10 months in March, but a drop in the unemployment rate to a near 10-year low of 4.5 percent pointed to a labour market that continues to tighten. Nonfarm payrolls increased by 98,000 jobs last month as the retail sector shed employment for a second straight month, the Labour Department said on Friday, the fewest since last May. The economy enjoyed job gains in excess of 200,000 in January and February as unusually warm temperatures pulled forward hiring in weather-sensitive sectors like construction, leisure and hospitality. In March, temperatures dropped and a storm lashed the Northeast. The unemployment rate fell two-tenths of a percentage point to 4.5 percent, the lowest level since May 2007. Economists polled by Reuters had forecast payrolls increasing 180,000 last month and the unemployment rate unchanged at 4.7 percent. The economy needs to create 75,000 to 100,000 jobs per month to keep up with growth in the working-age population. The labour market is expected to hit full employment this year, which could drive faster wage growth.
German output surges as industry enjoys ‘extraordinary’ start to year
German industrial output surged in February and the trade surplus swelled as the engine room of Europe’s largest economy fired on all cylinders to satisfy demand at home and abroad, assuaging angst about rising protectionism. Describing an "extraordinarily robust" start to the year for industry, the Economy Ministry said output rose by 2.2 percent on the month, matching January’s expansion. A Reuters poll had pointed to a dip of 0.1 percent in February. Separate trade data showed a 0.8 percent rise in exports on the month in February, with imports falling 1.6 percent for a net expansion in Germany’s trade surplus to 21.0 billion euros ($22.37 billion) from 18.9 billion euros in January. "Today’s reports on German industrial production and trade were both very strong," said JP Morgan economist Greg Fuzesi. The robust German performance in February contrasted with an unexpected fall in British industrial output, adding to signs that British economic growth may have slowed as the UK prepares to leave the European Union.
China FX reserves stay above $3 trillion after small March rise
China’s foreign exchange reserves stayed above $3 trillion (2.41 trillion pounds) in March, during which a pause in the dollar’s rally aided Beijing’s efforts to contain capital outflows. Reserves rose $3.96 billion during March – less than the $5 billion predicted in a Reuters poll – to total $3.009 trillion, compared with $3.005 trillion at the end of February. For graphic on U.S. Treasury assessment of currency manipulation. In January, reserves slipped below $3 trillion for the first time in nearly six years, but in February they moved back above that line with their first rise in eight months. The March increase marks the first time reserves had increased two consecutive months since April 2016. Julian Evans-Pritchard of Capital Economics said the way reserves were broadly stable in March "suggests that the recent easing of capital outflows has allowed the People’s Bank of China to step back from FX intervention."