JULY 9, 2018 – JOBS NUMBERS RISE, AS DOES THE UNEMPLOYMENT RATE
A healthy gain in payrolls for the month of June was not enough to keep the unemployment rate from rising slightly as more people entered the workforce.
The US economy added 213,000 jobs last month, beating economists’ expectations of 195,000 new jobs. The unemployment rate ticked up to 4 percent from 3.8 percent in May. Average hourly wages rose 2.7 percent from a year earlier.
The change in the unemployment rate is not worrisome; rather it’s an indicator of the strong economy drawing in new workers who have not yet been completely absorbed into the workforce. The addition of people into the labor market could help keep the economy from overheating, and as such, the Fed would remain on track to raise interest rates gradually in the months ahead.
As interest rates are going up, albeit at a moderate pace, the opportunity remains for investors to hedge against future rate increases and save on payments going forward. We continue to recommend interest rate swaps as the best way to hedge your loan portfolio.