Data published by the US Department of Labor and shockingly better than economists expected showed that US non-farm private sector created jobs for 2.5 million people in May.
Extraordinary Recovery in the USA
The unemployment rate in the world’s largest economy, one of the worst-hit countries by the coronavirus pandemic, fell to 13,3, unlike disastrous expectations, such as 20 percent.
The figures showed that recovery from the economic collapse caused by the pandemic shock had begun and could happen much more quickly.
Economists participating in a Dow Jones survey expected 8 million 333 thousand job losses in private employment and the unemployment rate to rise from April’s 14.7 to 19.5 percent. If the expectations of Wall Street were correct, these numbers would be the worst ever since the Great Depression in the 20th century. The May figures show that the US may be on the fastest recovery path after the quickest economic fall in history.
Soon after the release of the data, US President Donald Trump took to Twitter that to praise himself and the economic recovery.
The figures mean relief and self-confidence for the Federal Reserve, which has taken extraordinary and unprecedented steps, including lowering interest rates to around 0 in recent months.
US stocks made record gains. Dow Jones rose more than 750 points, while Nasdaq appreciated 0.9 percent compared to the opening, SP gains exceeded 2 percent.
OPEC and Russia-led oil exporter allies have finally set a date for a meeting where they will discuss furthering production cuts. Countries called Opec+ will gather at a virtual meeting on Saturday to consider extending record oil production cuts beyond June.
Manufacturers previously agreed to reduce the supply by 9.7 million barrels (bpd) per day to support collapsing prices due to the coronavirus crisis.
Two OPEC sources said that Saudi Arabia and Russia agreed to extend the cuts to the end of July, but Riyadh wants the extension to be by the end of August.
“The current conditions now warrant hopefully successful meetings,” Saudi Energy Minister Prince Abdulaziz bin Salman told Reuters on Friday.
Sources said that at the upcoming monetary policy meeting of the Bank of Japan (BoJ), officials will continue to predict that the economy will gradually recover from coronavirus pandemic and its damage in the second half of this year.
According to BoJ sources, this attitude will strengthen market expectations that the bank and government will take bold monetary steps at the June review meeting after a series of support measures for businesses in the past few months.
The optimism of BOJ reflects the belief that the world’s third-largest economy hit a bottom in April or May.