Signs of cooling US labor strengthen amid lower job additions

On Wednesday, the US Automatic Data Processing (ADP) agency reported a decline in the number of job additions in the month of March. The US economy added 145K jobs in March, significantly lower than the estimates of 200K and the former release of 242K. Firms have slowed down their hiring process amid rising interest rates by the Federal Reserve (Fed) and a bleak economic outlook. A slowdown in the recruitment process after the release of weak Job Openings data indicates that the US labor market has started cooling off and chances are solid of an escalation in the Unemployment Rate ahead.

However, investors will get more clarity about the labor market condition after the release of the US Nonfarm Payrolls (NFP) data, which is scheduled for Good Friday. As per the consensus, the jobless rate is seen unchanged at 3.6%. An economic indicator that could prompt US consumer inflation expectations is the Average Hourly Earnings data. The street is anticipating a deceleration in the annual labor cost index to 4.3% from the former release of 4.6%. However, monthly wage data could accelerate by 0.3% against the former increment of 0.2%.

Reserve Bank of Australia opens gates for further rate hikes

Considering the current monetary policy as restrictive enough to tame stubborn inflation, the Reserve Bank of Australia (RBA) kept interest rates unchanged at 3.6% in its monetary policy meeting on Tuesday. However, Reserve Bank of Australia Governor Philip Lowe has kept doors open for more rate hikes in case Australian inflation continues to remain persistent. It is worth noting that Australia’s monthly Consumer Price Index (CPI) has softened quickly to 6.8% from the peak of 8.4% recorded in December.