NOVEMBER 9, 2020 – UNEMPLOYMENT RATE BELOW 7 PERCENT; FED PREDICTS DIFFICULT MONTHS AHEAD
The Labor Department reported on Friday the US added 638,000 jobs and the jobless rate fell to 6.9 percent in October. Both numbers beat expectations, as economists were looking for gains of 530,000 jobs and an unemployment rate of 7.7 percent. October’s job gains were slightly lower than the 672,000 in September. October’s growth brings payroll gains since May at approximately 12 million, but that still leaves 10 million unfilled posts that were lost in March and April.
At their regular monthly meeting last week, the Fed said interest rates will remain at zero. The Fed drew attention to the link between the virus and economic growth. Between rising infections and households depleting their savings, the months ahead will be difficult. They said they were committed to provide sustained stimulus, which could take place by adjustments to Treasury and mortgage backed securities. The Fed could extend programs which provide short term loans to cities and states to tide them over until the economy returns to a solid footing.