Goldman predicts QE3 next week as US jobs disappoint

The US economy added 96,000 jobs in August, failing to meet economists' expectations and prompting Goldman Sachs to predict a fresh round of quantitative easing next week.

Economists had expected 130,000 jobs to be added last month. The August figure was accompanied by downwards revisions to both June and July's additions, from 64,000 to 45,000 and from 163,000 to 141,000 respectively. The unemployment rate took a surprise dip from 8.3% to 8.1%, largely downto more people dropping out of the workforce. The US dollar extended its losses against the euro in response to the figures, the single currency standing at $1.2769 having hit a two-month high earlier in the day. Analysts at Goldman Sachs said they now expect the Federal Reserve to announce QE3 fo...