Dollar jumps as rising wages stoke inflation expectations
Source: Reuters
#BUSINESS NEWS OCTOBER 5, 2017 / 9:12 PM / UPDATED AN HOUR AGO
Karen Brettell
NEW YORK (Reuters) - The dollar jumped to more than two-month highs against the yen and seven-week highs against the euro on Friday after the governments jobs report for September showed rising wages.
Average hourly earnings increased 12 cents or 0.5 percent in September after rising 0.2 percent in August. The gains came as nonfarm payrolls fell by 33,000 jobs last month after Hurricanes Harvey and Irma left displaced workers temporarily unemployed and delayed hiring.
I think most people realized going in that the headline numbers would be distorted because of the storms, but the surprise was the average hourly earnings, said Win Thin, head of emerging markets currency strategy at Brown Brothers Harriman in New York.
This is the missing piece in the Feds puzzle, Thin added. I think the dollar rally is back on track and should continue next week.
Read more: http://www.reuters.com/article/us-global-forex/dollar-jumps-as-rising-wages-stoke-inflation-expectations-idUSKBN1CB03W
Loki Liesmith
(4,602 posts)Cicada
(4,533 posts)GoneOffShore
(17,340 posts)I could do with the euro costing 1.10$ but that's not likely to happen anytime soon.
ProfessorGAC
(65,076 posts)Inflation hawks are like 50's republicans looking for "reds under the beds". First, they worry way too much about slight amounts of it, second there is limited data to support that in a period of excess production and product/service surpluses that higher wages will actually trigger inflation.
They've been tooting that horn for 30+ years and no prediction of inflation by these buffoons has ever come to pass.
Remember when most conservative/libertarian economists predicted massive inflation in the 90's because unemployment was too low and taxes were too high? I do. We had nothing close to macroeconomically impactful price inflation.
Actually, middle class wages going up increase monetary velocity so there is no monetary inflation. No need to print more money, no monetary inflation.
These guys are more holding to a religious fervor about this. There's nothing scientific about their POV