The US economy unexpectedly shed 23,000 jobs in July, defying economists' forecasts
The national unemployment rate eased slightly to 4.1% in June due to a lower labour force participation rate
June payroll figures were revised sharply downwards to a mere 20,000 increase from the previously reported 57,000
US employers cut jobs in July as nonfarm payrolls fell by 23,000, casting doubt on whether the Federal Reserve will lift borrowing costs next month.
June job growth fell far short of initial estimates. The Bureau of Labor Statistics informed on Friday that employers added only 20,000 jobs in June, down from the previously reported 57,000, as per Reuters.
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The unemployment rate fell to 4.1% from 4.2% in June as the labour force participation rate declined further.
Economists polled by Reuters had forecast payrolls rising by 80,000, with estimates ranging from 10,000 to 140,000.
July hiring typically slows down. Economists describe the broader US job market as currently operating in a "slow hire, slow fire" mode.
The domestic market remained resilient. Local demand during the second quarter expanded at its quickest rate in over three years, even as the conflict in the Middle East entered its sixth month.
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Fed Rate Dilemma
Prior to the report, financial markets anticipated a September interest rate hike from the Federal Reserve.
The US central bank maintained its benchmark overnight rate between 3.50% and 3.75% last week. Three members of the Fed's policy-setting committee dissented, preferring a quarter-percentage-point hike.
Next week's inflation data could sharpen the debate on the near-term monetary policy outlook.
