Euro-Area Economic Growth Remains ‘Muted’ at Start of 2020 By Bloomberg


© Reuters. Euro-Area Economic Growth Remains ‘Muted’ at Start of 2020

(Bloomberg) — The euro-area economy continued to trundle along at the beginning of 2020, despite signs of a pickup in Germany.

IHS Markit’s for the region stayed at 50.9 in January, falling short of the 51.2 median forecast of economists. There was a drag from France, where strikes hit the sector, which offset an improvement in .

Weakness also persisted elsewhere in the region, with output growth there slowing to the lowest in six and half years. IHS Markit didn’t provide further details, and figures for other countries will only be available early next month.

The euro-area slipped slightly in January, while the index rose to a nine-month high of 47.8. That’s still at a level signalling contraction and the report also said factories continued to cut jobs.

On the upside, confidence across the private sector improved, thanks in part to a more upbeat manufacturing industry. Sentiment there jumped for a fifth month on hopes that the economy is past the worst of the recent downturn.

On Thursday, European Central Bank President Christine Lagarde offered a similar view, saying that downside risks to the economic outlook are “somewhat less pronounced.”

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How Real World Use Cases Will Drive Crypto Growth in 2020 By Cointelegraph



As enters its twelfth year, the past eleven offer a meaningful amount of time to identify key trends that have emerged around cryptocurrencies and blockchain technology. These trends provide insights that are helpful in projecting the future of the digital asset space and how it will take shape over the next decade.

In reflecting on the history of cryptocurrencies over their lifetime, there’s one pattern that immediately jumps out. Each successive wave of interest in the cryptocurrency space has been galvanized by new developments in the ecosystem. In particular, two significant catalysts were the rise of crypto exchanges and the initial coin offerings craze.

Continue Reading on Coin Telegraph

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Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Javid aims to double UK growth after Brexit: FT By Reuters



LONDON (Reuters) – Finance minister Sajid Javid is aiming to roughly double Britain’s underlying rate of economic growth after it leaves the European Union, but will not champion big manufacturing sectors that want to stick to EU rules.

In an interview with the Financial Times before he travels to meet business leaders in Davos, Switzerland, Javid said Britain would not commit to sticking to EU rules in post-Brexit trade talks – something many businesses want to ease cross-border checks.

“There will not be alignment, we will not be a ruletaker, we will not be in the single market and we will not be in the customs union – and we will do this by the end of the year,” he said.

The British Chambers of Commerce (BCC) said businesses were willing to be pragmatic about this approach to Brexit but added that the government needed to be clear about its plans.

“Uncertainty around the extent of divergence risks firms moving their production elsewhere,” BCC co-executive director Claire Walker said.

The opposition Labour Party said Javid’s plans amounted to right-wing ideology overriding common sense and that jobs in the motor industry and manufacturing were under threat.

Prime Minister Boris Johnson has said there will be no extension to an 11-month window in which he hopes to negotiate a long-term trade agreement with the EU after Britain leaves on Jan. 31, despite the EU saying this is unrealistic.

The Financial Times reported that Javid wanted to boost annual economic growth rates to the 2.75% level seen in the second half of the 20th century through greater investment in skills training and physical infrastructure.

Britain’s economy probably grew about 1.3% last year, and the Bank of England estimates it will struggle to grow much faster over the long run due to reduced immigration and greater trade friction after Brexit.

Javid will present his first budget on March 11, and said it would focus on “people and place”, part of the Conservative government’s efforts to reward traditionally Labour-supporting areas that backed it due to Brexit in Dec. 12’s election.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



China posts weakest growth in 29 years as trade war bites, but ends 2019 on better note


BEIJING (Reuters) – China’s economic growth cooled to its weakest in nearly 30 years in 2019 amid a bruising trade war with the United States, and more stimulus is expected this year as Beijing tries to boost sluggish investment and demand.

But data on Friday also showed the world’s second-largest economy ended the rough year on a somewhat firmer note as a trade truce revived business confidence and earlier growth boosting measures finally appeared to be taking hold.

As expected, China’s growth slowed to 6.1% last year, from 6.6% in 2018, data from the National Bureau of Statistics showed. Though still strong by global standards, and within the government’s target range, it was the weakest expansion since 1990.

This year is crucial for the ruling Communist Party to fulfill its goal of doubling gross domestic product (GDP) and incomes in the decade to 2020, and turning China into a “moderately prosperous” nation.

Analysts reckon that long-term target would need growth this year to remain around 6%, though top officials have warned the economy may face even greater pressure than in 2019.

More recent data, along with optimism over a Phase 1 U.S.-China trade deal signed on Wednesday, have raised hopes that the economy may be bottoming out.

Fourth-quarter GDP rose 6.0% from a year earlier, steadying from the third quarter, though still the weakest in nearly three decades. And December industrial output, investment and retail sales all rose more than expected after an improved showing in November.

Policy sources have told Reuters that Beijing plans to set a lower growth target of around 6% this year from last year’s 6-6.5%, relying on increased infrastructure spending to ward off a sharper slowdown. Key targets are due to be announced in March.

On a quarterly basis, the economy grew 1.5% in October-December, also the same pace as the previous three months.

“We expect China’s growth rate will come further down to below 6%” in the coming year, said Masaaki Kanno, chief economist at Sony Financial Holdings in Tokyo.

“The Chinese economy is unlikely to fall abruptly because of … government policies, but at the same time the trend of a further slowdown of the economy will remain unchanged.”

SIGNS OF IMPROVEMENT, BUT WILL IT LAST?

December data released along with GDP showed a surprising acceleration in industrial output and a more modest pick-up in investment growth, while retail sales were solid.

Industrial output grew 6.9% from a year earlier, the strongest pace in nine months, while retail sales rose 8.0%. Fixed-asset investment rose 5.4% for the full year, but growth had plumbed record lows in autumn.

Easing trade tensions have made manufacturers more optimistic about the business outlook, analysts said, though many of the tit-for-tat tariffs both sides imposed during the trade war remain in place.

“Despite the recent uptick in activity, we think it is premature to call the bottom of the current economic cycle,” Julian Evans-Pritchard and Martin Rasmussen at Capital Economics said in a note.

“External headwinds should ease further in the coming quarters thanks to the ‘Phase One’ trade deal and a recovery in global growth. But we think this will be offset by a renewed slowdown in domestic demand, triggering further monetary easing by the People’s Bank.”

Among other key risks this year, infrastructure — a key part of Beijing’s stabilization strategy — has remained stubbornly weak.

Infrastructure investment grew just 3.8% in 2019, decelerating from 4% in January-November, despite sharply higher local government bond issuance and other policy measures.

“This shows that local governments continued to face funding constraints…,” said Tommy Xie, China economist at OCBC Bank in Singapore.

A girl runs past a man as he smokes in Beijing’s central business area, China January 17, 2020. REUTERS/Jason Lee

Some analysts are also worried about signs of cooling in the housing market, a key economic driver.

Property investment growth hit a two-year low in December even as it grew at a solid 9.9% pace in 2019. Property sales fell 0.1%, the first annual decline in five years.

Beijing has worked for years to keep speculation and home price rises in check, and officials vowed last year they would not use the property market as a form of short-term stimulus.

MORE SUPPORT MEASURES

China will roll out more support measures this year as the economy faces further pressure, Ning Jizhe, head of the Statistical bureau told a news conference.

Ning noted that per capital GDP in China had surpassed $10,000 for the first time last year. But analysts believe more painful reforms are needed to generate additional growth.

Beijing has been relying on a mix of fiscal and monetary steps to weather the current downturn, cutting taxes and allowing local governments to sell huge amounts of bonds to fund infrastructure projects.

Banks also have been encouraged to lend more, especially to small firms, with new yuan loans hitting a record 16.81 trillion yuan ($2.44 trillion) in 2019.

The central bank has cut banks’ reserve requirement ratios (RRR) – the amount of cash that banks must hold as reserves – eight times since early 2018, most recently this month. China has also seen modest cuts in some lending rates.

Analysts polled by Reuters expect further cuts in both RRR and key interest rates this year.

But Chinese leaders have repeatedly pledged they will not embark on massive stimulus like that during the 2008-09 global crisis, which quickly juiced growth rates but left a mountain of debt.

Slideshow (7 Images)

Containing financial system risks will remain a high priority for policymakers this year. Corporate bond defaults hit a new record last year, while state-linked firms had to step in to rescue several troubled smaller banks.

Even with additional stimulus and assuming the trade truce holds, economists polled by Reuters expect China’s growth will cool this year to 5.9%.

Reporting by Kevin Yao; Editing by Kim Coghill



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China posts weakest growth in 29 years as trade war bites, but ends year on firmer note


BEIJING (Reuters) – China’s economic growth slowed to its weakest in nearly 30 years in 2019 amid a bruising trade war with the United States and sputtering investment, and more stimulus steps are expected this year to help avert a sharper slowdown.

FILE PHOTO: A teller counts yuan banknotes at a China Merchants Bank branch in Hefei, Anhui province, October 20, 2010. REUTERS/Stringer

Fourth-quarter gross domestic product (GDP) rose 6.0% from a year earlier, data from the National Bureau of Statistics showed on Friday, in line with expectations and steady from the pace in the third quarter.

That left full-year growth at 6.1%, the slowest rate of expansion China has seen since 1990. Analysts had expected it to cool from 6.6% in 2018 to 6.1%.

While recent data have pointed to some signs of improvement in the ailing manufacturing sector, and a newly-signed Sino-U.S. trade deal has helped revive business confidence, analysts are not sure if the gains can be sustained.

This year is crucial for the ruling Communist Party to fulfill its goal of doubling GDP and incomes in the decade to 2020, and turning China into a “moderately prosperous” nation.

Even with additional stimulus and the trade war truce, economists polled by Reuters expect growth will cool further this year to 5.9%.

Policy sources have told Reuters that Beijing plans to set a lower economic growth target of around 6% this year from last year’s 6-6.5%, relying on increased infrastructure spending to ward off a sharper slowdown.

On a quarterly basis, the economy grew 1.5% in October-December from the previous three months, in line with expectations and also steadying.

December data released along with quarterly GDP showed a surprising acceleration in factory output and investment growth, while retail sales grew at a steady, solid pace, suggesting the economy ended the year on a firmer note.

Industrial output grew 6.9% in December from a year earlier, the strongest pace in nine months. Analysts had expected growth to dip to 5.9% from 6.2% in November.

Fixed-asset investment rose 5.4% for the full year, versus expectations for a 5.2% increase, the same as in the first 11 months of the year.

Retail sales rose 8.0% in December on-year, compared with forecasts for 7.8% and November’s 8.0%.

Real estate investment rose 9.9% in 2019 from a year earlier, slowing slightly from a 10.2% gain in the first 11 months of the year.

Beijing has been relying on a mix of fiscal and monetary steps to weather the current downturn, cutting taxes and allowing local governments to sell huge amounts of bonds to fund infrastructure projects.

Banks also have been encouraged to lend more, especially to small firms, with new yuan loans hitting a record 16.81 trillion yuan ($2.44 trillion) in 2019. But the economy has been slow to respond, and investment growth has slid to record lows.

Reporting by Kevin Yao; Editing by Kim Coghill



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Economists Don’t See Any U.S. Growth Bump From U.S.-China Deal By Bloomberg



(Bloomberg) — Economists played down the prospect that the first phase of a trade deal signed this week by the U.S. and China will lift American economic growth in 2020, contradicting the optimism of the Trump administration.

The American Bankers Association’s Economic Advisory Committee– a group of chief economists from large banks including Citigroup Inc (NYSE:). and Morgan Stanley (NYSE:) — forecast gross domestic product growth would slow to 1.9% in 2019 and stay there in 2020. That’s well below the 2.5% pace floated by Treasury Secretary Steven Mnuchin in a Fox News interview on Sunday. A Bloomberg survey conducted earlier this month estimated the U.S. economy expanded 2.3% last year and will grow 1.8% this year.

The economists cited lingering trade uncertainty as a risk during a press conference in Washington on Thursday, but said strong wage growth, low unemployment and continued job gains would ensure that consumer spending continues to support expansion.

“The concern is that there is still a lot of uncertainty about the relationship, not just between the U.S. and China, but also potential other trade uncertainties going forward with regard to other regions,” Catherine Mann, the committee’s chair and Citi’s global chief economist, told reporters.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



China Home-Price Growth Accelerates as Curbs Eased By Bloomberg


© Reuters. China Home-Price Growth Accelerates as Curbs Eased

(Bloomberg) — China home-price growth accelerated for the first time in seven months, as authorities took steps to ease some property curbs and head off a broader downturn.

  • New-home prices, excluding state-subsidized housing, rose 0.35% last month from November in 70 major cities, National Bureau of Statistics data showed Thursday. That’s slightly better than the 0.3% gain the previous month.
  • Fifty cities reported a gain in values, up from 44 in November.

Key Insights

  • After price-growth slowed in the second half of last year, some local governments are now acting to support the property market and head off a steeper downturn that would further undermine an economy growing at the slowest pace in almost 30 years.
  • Guangdong province this week said it will make it easier to obtain highly sought-after residency permits, which has the potential to boost home sales. Last month, three municipal authorities in Sichuan and Hunan provinces offered cash handouts to home-buyers.
  • The easing of property curbs may last another six months “as policymakers look to avoid a sharp industry slowdown,” according to John Lam, head of China real estate research at UBS Group AG.
  • They may also be welcomed by cash-strapped developers, who have been cutting prices to attract buyers. China Evergrande Group’s nationwide sales promotion has started earlier than in previous years and will last longer, after the developer unveiled its weakest sales-growth target in eight years.

Get More

  • The gains were stronger in so-called second- and third-tier cities, where authorities have been more supportive of the market. Growth slowed in the four biggest cities, where curbs remain stringent.
  • For more detail on the data, click here

Read More

  • China Loosens Urban Residency Restrictions to Spur Growth
  • China Gets Creative on Home Prices as Real Estate Market Cools
  • China’s Biggest Home Builders Turn in Poor Sales Growth for 2019

(Adds chart)

To contact Bloomberg News staff for this story: Emma Dong in Shanghai at edong10@bloomberg.net

To contact the editors responsible for this story: Katrina Nicholas at knicholas2@bloomberg.net, Peter Vercoe, Jonas Bergman

©2020 Bloomberg L.P.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



BOJ to keep policy steady, raise growth outlook as risks subside By Reuters



By Leika Kihara and Takahiko Wada

TOKYO (Reuters) – The Bank of Japan is expected to keep monetary policy steady next week and nudge up its economic growth forecast, as the U.S.-China trade deal and de-escalation in Middle East tensions take some pressure off the central bank for more stimulus.

But BOJ Governor Haruhiko Kuroda will likely voice his resolve to keep monetary policy ultra-loose as the economy continues to feel the strain from the trade war and October’s sales tax hike.

At the two-day rate review that ends on Tuesday, the BOJ is set to keep its short-term interest rate target at -0.1% and a pledge to guide 10-year government bond yields around 0%.

It is also seen maintaining a guidance that commits to keeping rates at current low levels, or even to cut them, until risks keeping it from achieving its 2% inflation goal subside.

“What the BOJ describes as the economy’s momentum for hitting its inflation target appears to be sustained,” said Mari Iwashita, chief market economist at Daiwa Securities.

“The BOJ will kick off 2020 by maintaining its current policy stance with a careful eye on developments.”

In a quarterly review of its forecasts, the BOJ is seen slightly revising up its growth projection for the fiscal year starting in April, helped by a boost from the government’s stimulus package, sources have told Reuters.

Under current projections made in October, the BOJ expects the economy to expand 0.7% in fiscal 2020 and 1.0% the following year.

AUTOS A CONCERN

Japan’s economy ground to a near halt in July-September and is likely to have contracted in the final quarter of last year as the U.S.-China trade war knocked exports.

BOJ officials hope the government’s $122 billion fiscal package and robust capital expenditure will offset the hit from soft global demand and supply chain disruptions from last year’s typhoons that continue to weigh on factory output.

Policymakers are also more optimistic than late last year as technology firms clear inventory and Washington and Beijing have signed a first phase trade deal.

But pessimists in the BOJ fret that weak global auto demand and the drag on consumption from October’s sales tax hike to 10% from 8% may mean only a modest rebound in January-March growth.

The BOJ on Wednesday revised down its economic assessment of the Tokai central Japan region – home to auto giant Toyota Motor Corp (T:) – as some manufacturers were forced to cut output on weak demand.

Markets are watching how Kuroda would assess such risks in his post-meeting briefing, for clues on the policy outlook.

While rising energy costs and the boost from the fiscal package could offer some lift to inflation, the BOJ is unlikely to make big changes to its price projections, sources say.

The BOJ now estimates core consumer inflation to hit 1.1% in fiscal 2020 and 1.5% the following year.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Bank of America beats on bond trading boost, loan growth By Reuters


© Reuters. A Bank of America building is seen in Los Angeles

(Reuters) – Bank of America Corp (NYSE:) beat analysts’ estimates for quarterly profit on Wednesday, as a boost from bond trading and growth in its loan book helped the second-biggest U.S. lender blunt a hit from lower interest rates.

Bond trading has been a bright spot for big U.S. banks that reported fourth-quarter results this week, largely due to easy comparisons from a year earlier when financial markets were selling off due to concerns over trade and global growth.

Bank of America reported a 25% rise in bond trading revenue, although that was far short of the 86% surge at JPMorgan Chase (NYSE:) and Co and a 49% jump at Citigroup Inc (NYSE:).

Loans grew 6% at Bank of America, significantly outpacing increases at Citigroup and JPMorgan. Bank’s deposits rose 5%.

“Solid client activity in growing loans and gathering deposits helped us offset spread compression,” Chief Financial Officer Paul Donofrio said in a statement.

However, revenue in consumer banking, the bank’s biggest business, fell 5% to $9.5 billion, largely due to the three interest rate cuts last year by the Federal Reserve.

The bank’s net interest margin, which measures how profitably a bank can lend out depositors’ funds, fell to 2.35% from 2.52% a year earlier, and from 2.41% in the prior quarter.

Bank of America is the most vulnerable among the big U.S. banks to fluctuations in interest rates because of its large deposit stock and rate-sensitive mortgage securities.

Net income applicable to common shareholders fell to $6.75 billion in the fourth quarter ended Dec. 31, from $7.04 billion a year earlier.

Excluding items, the bank reported a profit of 75 cents per share, beating analysts’ estimate of 68 cents.

Revenue, net of interest expense, fell slightly to $22.35 billion.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



U.S. job growth cools in December, but labor market tight By Reuters



By Lucia Mutikani

WASHINGTON (Reuters) – U.S. job growth slowed more than expected in December, but the pace of hiring likely remains sufficient to keep the longest economic expansion in history on track despite a deepening downturn in a manufacturing sector stung by trade disputes.

The Labor Department’s closely watched monthly employment report on Friday also showed the jobless rate holding near a 50-year low of 3.5%. A broader measure of unemployment dropped to a record low last month, but wage gains ebbed. The mixed report will probably not change the Federal Reserve’s assessment that both the economy and monetary policy are in a “good place.”

“There is nothing here that changes the picture of an economy that is continuing to expand at a pace that exceeds its potential growth rate,” said Conrad DeQuadros, senior economic advisor at Brean Capital in New York. “The Fed should be very comfortable with this report.”

Nonfarm payrolls increased by 145,000 jobs last month, with manufacturing shedding jobs after being boosted in November by the return to work of about 46,000 production workers at General Motors (N:) after a strike, the government’s survey of establishments showed. That was the smallest gain since May.

But milder-than-normal temperatures in December boosted hiring at construction sites, and employment at retailers surged last month. Some of the slowdown in overall job growth in December is likely due to seasonal volatility associated with a later-than-normal Thanksgiving Day. Economists polled by Reuters had forecast payrolls rising by 164,000 jobs in December.

Roughly 100,000 jobs per month are needed to keep up with growth in the working-age population. Data for October and November was revised to show 14,000 fewer jobs added than previously reported. The economy created 2.1 million jobs in 2019, down from 2.7 million in 2018.

Reports on housing, trade and consumer spending have suggested that the economic expansion, now in its 11th year, is not in immediate danger of being derailed by a recession. Worries that a downturn might be triggered by the Trump administration’s trade war with China spurred the Fed to cut interest rates three times in 2019.

Indeed economic growth did slow last year, throttling back to 2.1% in the third quarter from 2018’s brisk pace of nearly 3%. Now, though, with a Phase 1 deal with China set to be signed next week, policymakers are more confident in the outlook and last month signaled borrowing costs could remain unchanged at least through this year. Economists are pegging growth at the end of last year around a 2.3% rate.

The dollar firmed slightly against a basket of currencies. U.S. Treasury prices rose. Stocks on Wall Street were trading marginally higher.

TIGHT LABOR MARKET

The labor market has continued to churn out jobs at a healthy clip, despite anecdotal evidence of worker shortages, which economists had feared would significantly restrain hiring.

There are, however, concerns the Labor Department’s Bureau of Labor Statistics (BLS), which compiles the employment data, may not be fully capturing the impact on payrolls of President Donald Trump’s 18-month-long trade war with China, which has pushed manufacturing into recession and led to company closures.

The government last August estimated that the economy created 501,000 fewer jobs in the 12 months through March 2019 than previously reported, the biggest downward revision in the level of employment in a decade. That suggests job growth over that period averaged around 170,000 per month instead of 210,000. The revised payrolls data will be published next month.

The projected massive revision has attracted the attention of some Fed officials. Minutes of the U.S. central bank’s Dec. 10-11 policy meeting published last week showed a “couple” of officials viewed the anticipated downgrade as an indication “that payroll employment gains would likely show less momentum coming into this year.”

Economists say downward revisions of that magnitude suggest that the model the government uses to calculate the net number of jobs from new business and closings is faulty. Some expect payrolls growth beyond last March could also be revised down.

For now, the labor market is on solid footing, with the unemployment rate declining by five-tenths of a percentage point in 2019. There was little impact on the jobless rate from annual revisions to the seasonally adjusted household survey data going back five years, which were incorporated in December’s employment report.

A broader measure of unemployment, which includes people who want to work but have given up searching and those working part-time because they cannot find full-time employment, fell to 6.7% in December, the lowest since the series started in 1994, from 6.9% the prior month. The labor force participation rate, or the proportion of working-age Americans who have a job or are looking for one, was steady at 63.2% last month.

The tight labor market, however, has struggled to generate strong wage inflation. Average hourly earnings rose three cents, or 0.1% last month, after increasing 0.3% in November. That lowered the annual increase in wages to 2.9% in December from 3.1% in November.

Manufacturing employment dropped by 12,000 jobs in December after jumping 58,000 in November as the GM strike ended. The Institute for Supply Management’s measure of national factory activity dropped in December to its lowest level since June 2009. Manufacturing added only 46,000 job in 2019 compared to 264,000 in 2018.

Hiring at construction sites increased by 20,000 jobs in December. There were increases in leisure and hospitality, professional and business services, financial activities, education and healthcare, retail and wholesale trade employment last month. But the transportation and warehousing industry lost 10,400 jobs, and mining and logging shed 9,000 positions.

Government employment rose by 6,000 jobs. It is expected to accelerate in the coming months amid increased hiring for the 2020 Census.