US Job Growth Numbers Revised Lower After Fed Rate Hike

The US Bureau of Labor Statistics (BLS) has revised its job growth numbers for July and August, reducing the previously reported gains by 60,000. This downward revision is significant because it contradicts the initial data that influenced the Federal Reserve's decision to raise interest rates on September 16.

According to the BLS, the US economy added only 10,000 jobs in July instead of the initially reported 21,000 gain. The August estimate was also reduced by 29,000 jobs, from a previously reported gain to a loss.

The Fed's rate hike on September 16 marked the first time in three years that interest rates were increased to slow down inflation. The decision was based on data suggesting 'the labor side of the Fed's congressional remit is in good shape,' allowing for an increase in mortgage and credit costs.

However, the BLS's revised numbers have cast doubt on the Fed's assertion that job gains are keeping pace with the workforce. Jefferies' chief US economist downplayed the August job growth as 'nothing more than a rebound from very weak hiring in June and July.'