San Antonio Express-News - - BUSI­NESS -

ten­sions be­tween the U.S. and China, on­go­ing in­ter­est rate in­creases by the Fed­eral Re­serve and weak­en­ing global growth have roiled fi­nan­cial mar­kets. An­a­lysts ex­pect growth to slow but re­main solid in 2019 as the im­pact of last year’s tax cuts fade.

The jobs fig­ure was less than many economists forecast, but few saw the re­port as a sign of a broader slow­down.

“The econ­omy con­tin­ues to churn out new jobs and re­flects the strong un­der­ly­ing busi­ness con­di­tions that point to steady, al­beit slower job growth and eco­nomic ac­tiv­ity in 2019,” said Joe Brusue­las, chief econ­o­mist at con­sult­ing firm RSM. “This re­port strongly im­plies that a re­ces­sion is not loom­ing just over the hori­zon.”

The re­port is un­likely to dis­suade the Fed­eral Re­serve from rais­ing short-term in­ter­est rates at its meet­ing later this month, as ex­pected, Brusue­las said. But it sug­gests the Fed may not hike rates next year as rapidly as many in­vestors have feared.

Stock prices rose in the im­me­di­ate af­ter­math of the re­port but fell in late morn­ing trad­ing. The Dow Jones dropped 225 points or 0.9 per­cent.

The on­go­ing job gains are push­ing down un­em­ploy­ment rates to his­tor­i­cally low lev­els for a va­ri­ety of groups. The un­em­ploy­ment rate for men aged 20 and above fell last month to 3.3 per­cent, the low­est in 18 years. And the rate for Amer­i­cans with just high school diplo­mas dropped to 3.5 per­cent, the low­est since De­cem­ber 2000. The African-Amer­i­can job­less rate de­clined to 5.9 per­cent, match­ing May’s fig­ure as the low­est on record.

Novem­ber’s job gains are down from Oc­to­ber’s ro­bust 237,000, which was re­vised lower from last month’s es­ti­mate. Hir­ing has av­er­aged 195,000 a month for the past six months, mod­estly be­low an av­er­age of 212,000 in the pre­vi­ous six.

Hir­ing in Novem­ber was led by health care firms, which added 40,100 jobs, and pro­fes­sional ser­vices such as ac­count­ing and engi­neer­ing, which gained 32,000. Man­u­fac­tur­ing com­pa­nies hired 27,000 new work­ers, the most in seven months and a sign that trade ten­sions have yet to weaken fac­tory hir­ing.

Con­struc­tion firms cut back, adding 5,000 jobs, the fewest in five months. Hir­ing also slowed in restau­rants, bars and ho­tels.

Most re­cent data have pointed to solid eco­nomic growth. Amer­i­cans in­creased their spend­ing in Oc­to­ber by the most in seven months, and their in­comes grew by the most in nine months, ac­cord­ing to a gov­ern­ment re­port last week. Con­sumer con­fi­dence re­mains near 18-year highs, sur­veys show. And both man­u­fac­tur­ing and ser­vices com­pa­nies ex­panded at a healthy pace in Novem­ber, ac­cord­ing to a pair of busi­ness sur­veys.

The hous­ing mar­ket, though, has stum­bled this year as the Fed’s rate hikes have contributed to sharply higher mort­gage rates. Sales of ex­ist­ing homes have fallen 5.4 per­cent­from a year ear­lier, the big­gest an­nual de­cline in more than four years.

In­vestors, how­ever, are mostly fo­cused on where the econ­omy is headed. They are wor­ried that the U.S.-China trade war could still in­ten­sify, de­spite an agree­ment over the week­end be­tween Pres­i­dents Don­ald Trump and Xi Jin­ping that in­cluded post­pon­ing a planned U.S. tar­iff hike for 90 days. Higher tar­iffs would com­pound the risks for a global econ­omy that is al­ready grap­pling with dis­mal growth fig­ures from Europe and Ja­pan.

The in­ter­est rate paid by longer-term bonds has also fallen sharply in the past month, pan­ick­ing in­vestors, while short-term rates have de­clined by much less. That typ­i­cally sig­nals a weaker econ­omy ahead.

And the Fed­eral Re­serve has raised short-term in­ter­est rates three times this year and is likely to do so a fourth time later this month, thereby rais­ing bor­row­ing costs for con­sumers and busi­nesses. The Fed has sig­naled that it could in­crease rates again next year.

An­nie Rice / Associated Press

Peo­ple at­tend a job fair in Chicago. Em­ploy­ers have slowed their hir­ing rate, the gov­ern­ment said Fri­day, but few an­a­lysts see the re­port as a sign of an eco­nomic slow­down.

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