The unemployment rate keeps rising, now standing at 5.7%. It reflects further weakening of the economy.
There is a strong relationship between unemployment rate and short-term interest rates (those supposedly controlled by the Fed)(click on graph to enlarge).
Rising unemployment rate is accompanied by lower interest rates.
Declining unemployment rate is accompanied by higher interest rates.
The bottom line: short-term interest rates will not rise as long as the economy remains weak and the unemployment rate keeps rising.
More, much more when you subscribe to The Peter Dag Portfolio on https://www.peterdag.com/.
George Dagnino, PhD
Editor, The Peter Dag Portfolio
Since 1977
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