US nonfarm payrolls rose by a disappointing 126,000 in March, the smallest monthly increase since December 2013. Bloomberg thinks that the slower employment growth is the result of the appreciation of the US dollar.
The March jobs report showed tell-tale signs that the factory sector is struggling and the broader economy is feeling the impact. Private sector job growth slowed to the weakest pace since December of 2013, as manufacturing employment fell into contraction. While some economists will be quick to attribute this to port disruptions and weather, it is the view of Bloomberg Economics that this is the broader impact from a stronger dollar hurting the export sector as well as domestic industry.
The report is likely to trigger a re-assessment of the timing of interest rate hikes. Indeed, after the employment report, the rate for fed funds futures for December fell four basis points to 0.34 percent on Friday. S&P 500 futures fell 1 percent.
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