Disappointing jobs report raises questions over Fed forward guidance

federal reserve

The US unemployment rate dropped from 7% to 6.7% in December as more people dropped out of the labour force but just 74,000 new jobs were added, according to the US Bureau of Labor Statistics – raising questions about the applicability of the Federal Reserve's 6.5% unemployment rate "threshold" as a token of robust economic recovery.

While the Fed has recently downplayed the importance of its 6.5% threshold by emphasising that reaching it will not necessarily trigger a tightening of monetary

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