PrefBlog

There was a good US jobs number:

American employers added more workers than forecast in October and a rush of people entering the labor force pushed the jobless rate higher, according to the last report on the labor market before next week’s presidential election.

Broad-based gains in employment — from car dealers and hospitals to factories and construction sites — indicate consumers are likely to spend more freely and shore up the three-year expansion in the face of a global economic slowdown and political gridlock in Washington over taxes and spending.

Hiring increased by 171,000 workers after a 148,000 gain in September that was bigger than first estimated, Labor Department figures showed today in Washington. October’s increase exceeded the most optimistic forecast in a Bloomberg survey with a median projection of a 125,000 gain. Unemployment rose to 7.9 percent.

Federal Reserve Bank of San Francisco President John Williams spoke in defense of QE3 today:

Concern that large-scale asset purchases “might ignite a bout of inflation” are unwarranted because price increases are being held in check by elevated unemployment and an economy that “isn’t operating at full speed,” Williams said.

“Unemployment is — and should be — a central focus of monetary policy right now,” Williams said. “This concentration on getting unemployment down in no way represents a lessening of the importance of price stability,” he said, adding that inflation may slow well below the Fed’s 2 percent goal if the U.S. recovery falters.

Williams said central bank purchases of bonds will help spur U.S. economic growth to 2.5 percent next year and 3.5 percent in 2014 while not fueling inflation.

“Our policy measures are having the desired effects,” Williams said today in remarks prepared for a speech in Salt Lake City. “We have substantial scope to use monetary policy to stimulate the economy without creating too much upward pressure on prices.”

It was a modestly good day for the Canadian preferred share market, with PerpetualPremiums up 9bp, FixedResets flat and DeemedRetractibles gaining 8bp. Volatility was at normal levels, all to the upside with a preponderance of insurance issues. Volume was below average.

This entry was posted on Saturday, November 3rd, 2012 at 1:11 am and is filed under Market Action. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.