There has been a decline in new jobs in the US during September and 2.63 lakh new jobs were added in the month, although this is better than the market estimate of 2.48 lakh new jobs. After the data, there was a sharp decline in the market
Investors panic over better-than-expected employment figures
There has been a sharp decline in the US stock markets in Friday’s trading. In fact, with better-than-expected data in the US job market, investors fear that the Federal Reserve will continue its toughness and there is a possibility of a sharp increase in rates in the coming review. can deepen. The IMF has already predicted a slowdown in 2023. For this reason, after better data of the job market, there has been a decline in the US market and further its effect can spread to the domestic markets.
What are the job market figures
According to the data released yesterday, there has been a decline in the number of new jobs in September but still 2.63 lakh new jobs have been added to the system during a month. The market was earlier projecting 2.48 lakh new jobs. At the same time, the unemployment rate has also declined during this period and it has come down from 3.7 percent to 3.5 percent.
After the report, there has been a sharp decline in the US markets and at one time the S&P 500 broke down by about 2 percent. While the yield on the 2-year Treasury note has increased from 4.26 percent to 4.31 percent … indicating that investors are agreeing. are that the Federal Reserve will further increase rates sharply.
What will be the effect of Fed’s steps
The strictness of the Federal Reserve will put pressure on the domestic markets and the rupee against the dollar. In fact, as yields rise, investors will withdraw money from riskier assets and invest in safer investments, which can increase fund exits from the markets. At the same time, this will strengthen the dollar and there is a possibility that the rupee may fall to new low levels. At present, the rupee has closed at new lows above 82 against the dollar.