Why A Return To Slower Growth Won’t Stop A Fed Rate Hike In 2015
ByWith a large shortfall in the March nonfarm payrolls number, analysts are struggling to understand the weakness in the jobs report and the implications it holds for the direction of the economy and interest rates. After last year’s weak first quarter, the economy added an average of 281,900 jobs per month from March through December of 2014. In March of 2015, the economy added only 126,000 jobs, falling almost 156,000 jobs short of the earlier average. Several explanations have been suggested for the weakness. Some explanations suggest we can expect a quick rebound. Others indicate the weakness could drag on for a longer period of time. Patterns in the jobs report and in other indicators of the economy, suggest growth remains weak but it still seems likely the Federal Reserve will raise interest rates before the end of the year.
Weather has been blamed for a variety of disappointing economic statistics. The strong rebound from last year’s hard winter has raised hopes for a repeat performance this year. Data from the National Climactic Data Center confirm that January was wetter than normal but the temperatures were not extreme. February was extremely cold in many areas but the precipitation levels were not statistically high. By March, temperatures were warming. In comparison, the weather in 2014 offered both heavy precipitation and severe cold over a longer period of time. In contrast to last year, the severe weather this year was more focused on a single month and the severe levels of precipitation levels were not as widespread…
Why A Return To Slower Growth Won’t Stop A Fed Rate Hike In 2015
