The US labour market in pictures

Wednesday, 12 November 2014

The US labour market is the key to where the global business cycle next heads. If it tightens and begins to generate income growth then we can expect US profits and interest rates to rise together and the Australian dollar to fall more swiftly. If it recovers more slowly then the converse will be the case.

Westpac’s excellent Elliot Clarke offers some charts today to give us a guide:

That all adds up to the continuation of the first chart, “gradual repair”. Rate rises should not come until Q3 or Q4 next year.

About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.