“The Fed will continue to grapple with trying to tame inflation without tipping the economy into a recession,” said Dante DeAntonio, an economist at Moody’s Analytics in West Chester, Pennsylvania. “The data on wage and price growth will not do them any favors as upward pressure clearly remains even as the overall economy has weakened.”
The ECI is widely viewed by policymakers and economists as one of the better measures of labor market slack and a predictor of core inflation, as it adjusts for composition and job-quality changes. Data on Thursday, July 28, showing the economy contracted again in the second quarter led economists and investors to believe that the Fed would slow its pace of rate hikes in September.by another three-quarters of a percentage point. It has now hiked that rate by 225 basis points since March.
The advance in wages occurred across all industries, with hefty gains in the traditionally low-paying leisure and hospitality sector as well as retail industries. Private sector wages rose 5.7% from a year ago, also the biggest gain in the series. A slowdown in annual growth in average hourly earnings in the first half of the year had raised expectations of a peak in wage gains. Benefits increased 1.2% in the second quarter and were up 4.8% on a year-on-year basis.
The data was included in the advance gross domestic product report for the second quarter, published on Thursday. The economy contracted at a 0.9% annualized rate last quarter after shrinking at a 1.6% pace in the first quarter. Excluding the volatile food and energy components, the PCE price index shot up 0.6% after climbing 0.3% in May. The so-called core PCE price index increased 4.8% on a year-on-year basis in June after rising 4.7% in May.
Malaysia Malaysia Latest News, Malaysia Malaysia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: ANCALERTS - 🏆 26. / 50 Read more »
Source: bworldph - 🏆 9. / 68 Read more »