{"id":5525,"date":"2022-02-08T09:10:28","date_gmt":"2022-02-08T15:10:28","guid":{"rendered":"https:\/\/www.keystonefinancial.com\/?post_type=oi_article&p=5525"},"modified":"2022-02-08T09:10:30","modified_gmt":"2022-02-08T15:10:30","slug":"weekly-commentary-february-8-2022","status":"publish","type":"oi_article","link":"https:\/\/www.keystonefinancial.com\/articles\/weekly-commentary-february-8-2022","title":{"rendered":"Weekly Commentary | February 8, 2022"},"content":{"rendered":"\n
A rosy view through the rearview mirror.<\/p>\n\n\n\n
To say that economists did not have great expectations for the January employment report might be understating their position. It was widely believed that the spread of the COVID-19 Omicron variant would translate into a dismal jobs report. It didn\u2019t.<\/p>\n\n\n\n
\u201cAfter some estimates called for U.S. payrolls to decline by as much as 400,000, the labor market shockingly added that many jobs in January \u2013 and then some,\u201d reported Olivia Rockeman of Bloomberg.<\/p>\n\n\n\n
The United States added 467,000 jobs in January, and the numbers for November and December were adjusted upward, too, by more than 700,000, reported the Bureau of Labor Statistics.<\/p>\n\n\n\n
The U.S. unemployment rate ticked up to 4.0 percent as labor force participation rate \u2013 the number of people working or actively looking for jobs increased. The change in participation reflected updated population estimates in the household survey based on U.S. Census data that boosted the population of 35- to 64-year-olds and reduced the number of people age 65 and older.<\/p>\n\n\n\n
The jobless rate among those seeking employment was 3.4 percent for White people, 3.6 percent for Asian people, 4.9 percent for Hispanic people, and 6.9 percent for Black people. Teenagers had the highest unemployment rate at 10.9 percent.<\/p>\n\n\n\n
Signs of the economy\u2019s strength during the fourth quarter also showed in company earnings reports. Earnings reflect a company\u2019s profitability. With 56 percent of the companies in the Standard & Poor\u2019s 500 Index reporting fourth quarter earnings so far, \u201cThe index is reporting earnings growth of more than 25% for the fourth straight quarter [of 2021] and earnings growth of more than 45% for the full year,\u201d reported John Butters of FactSet.<\/p>\n\n\n\n
The jobs and earnings reports paint a picture of robust economic growth in the United States, despite supply chain issues and pandemic variants. Robust economic growth often is accompanied by rising demand for goods and that can push inflation higher, reported Investopedia. In 2021, U.S. inflation rose 7 percent, which is well above the 2 percent target set by the Federal Reserve (Fed), reported Christopher Rugaber of AP News.<\/p>\n\n\n\n
Last week\u2019s jobs report likely reinforced the Fed\u2019s commitment to pursue less accommodative monetary policy in 2022. Fed rate increases make borrowing more expensive, which cools economic growth and brings inflation into line.<\/p>\n\n\n\n
Major U.S. stock indices moved higher last week, according to Ben Levisohn of Barron\u2019s. The yield on 10-year U.S. Treasuries finished the week higher.<\/p>\n\n\n\n