NEW YORK/LONDON – Commodity prices jumped, the dollar slid to a two-month low and major global equity indexes scaled record peaks after weak US jobs data for April tamped down fears that a booming economy would spark inflation and higher interest rates.
The data eased worries the Federal Reserve would reduce its massive stimulus program anytime soon and was seen as helping President Joe Biden to push through his plans for trillions of dollars in new spending on infrastructure and education.
The yield on the benchmark 10-year US Treasury note dropped to a two-month low of 1.469 percent and gold extended a rally that put it on track for its best week since November. Copper burst to a new high, surpassing a record set a decade ago.
Nonfarm payrolls increased by only 266,000 jobs last month. Data for March was revised down to show 770,000 jobs added instead of 916,000 as previously reported. Economists polled by Reuters had forecast payrolls would advance by 978,000 jobs.
The report doused fears a booming US economy that would spur inflation and force interest rates higher.
“Anybody who thought the Fed is going to be tapering sooner than later, that’s not happening,” said Joseph LaVorgna, chief economist for the Americas at Natixis in New York.
“There is no inflation coming on the labor side. The economy is booming, and the labor market recovery is still ongoing.”
