US economy has downshifted into a slower gear - BBH

The US jobs data may be the more important economic report due for release this week as it will set the tone for the economic data for the remainder of month, including industrial production, construction spending and personal income and consumption, says the BBH analyst team.

"While performing better than most of the other high income countries, we suspect the US economy has downshifted into a slower gear and anticipate the employment data will reflect this", BBH explains. " In February, the consensus expects about 166k net new jobs were created, almost identical with the number private sector jobs created in January, which of course is subject to revision".

"A decline in the unemployment rate and/or an increase in the average hours worked would come as a surprise", they say. "Note that an increase in average hourly earnings may sound supportive for consumption, but to be meaningful, earnings have to increase in real, or inflation adjusted terms. Consumer prices appear to have ticked up in February after a flat January".