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Weekly economic review & outlook
Employment data not as strong as hoped

FEB. 08, 2021

You Need to Know

Week in review

Positive but weak job growth for January

Payrolls expanded by a mere 49,000 as hiring by many service sector businesses remained hampered by COVID restrictions. But unemployment fell sharply.

ISM surveys show continued business expansion

Surveys for services and manufacturing remained solidly in expansion territory for January despite the recent general economic slowdown.

Week Ahead

Forecasts

CPI expected to rise due to climbing energy prices

For the second month in a row, rising energy prices are likely to be the impetus for strong consumer price growth. But core CPI inflation is expected to remain modest.

Consumer sentiment should rise due to improved expectations

Positive early returns on vaccine effectiveness and the likelihood of further fiscal stimulus should boost consumer expectations and, consequently, consumer sentiment

Nonfarm payrolls rose by a meager 49,000 for January, with downward revisions to the prior two months, as hiring remained soft, especially within sectors dependent upon in-person consumer activity with government restrictions on mobility still in place. Private payrolls climbed by only 6,000 and were 100,000 jobs below the previously released total for December 2020 after annual benchmark revisions. The leisure and hospitality sector was the worst performing again, falling by 61,000 during January after plummeting by 536,000 for December. Compared with January 2020, total employment was still down by 9.6 million.

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