As evidenced by the June FOMC decision where policymakers opted to hold interest rates steady at 0.50%, employment plays a critical role in decisions related to monetary policy. However, Friday’s reading of nonfarm payrolls gives credence to the idea that the Federal Reserve may be able to raise rates an additional 25 basis points before the end of the year following the stunning rebound in job creation. The US economy managed to add 287,000 jobs during the month of June according to the Bureau of Labor Statistics, however, May was revised even lower, falling to only 11,000 new jobs from the 38,000 initially reported. While widely anticipated, unemployment ticked modestly higher to 4.90% from 4.70% prior. The reaction in financial markets was significant, with key US equity indices surging to the upside and the S&P 500 touching a new intraday record at 2133.00
