The most important number of the day was the JOLTs (job openings and labor turnover) employment report showed softness is almost undoubtably here in the labor market. The softness was modest and in my mind supportive of a FOMC Fed Funds rate cut of 1/4%.
Employment is the most important piece of economic news (at least that is my opinion) –with strong employment recessions are held at bay and demand for goods and services remain high–so any softening starts to show cracks in the economy.
The JOLTs report for July shows that separations were up 336,000 with the largest layoffs in accommodations and food service which may show travel and dining out are softening.
The number of job openings at 7.7 million was about a million fewer openings than a year ago–actually a nice drift lower–Goldilocks?
So tomorrow we have ADP jobs and then on Friday the official government numbers of employment.
The 10 year treasury fell 3-4 basis points on release of the JOLTs numbers–now around 3.79%. Let’s see where this goes by the end of the week.
All the detail on JOLTs is here.
I am extremely concerned with how over estimated the employment statistics wer. By a factor of 33% each and every month for a year. At this point any number is highly suspect. Maybe Brian Westbury is right, we should be more concerned with M2
I don’t pay much heed to any of those reports except as they can cause market blips for a day or so. For one thing they are old news telling us what happened last month or earlier. If anything important happened the insiders have already played it. Secondly they aren’t always accurate, as you say they can be highly suspect.
Unless we get a sharp reversal of the data of the past four months I think it’s all but certain that we get a 50 BPS cut on September 18 and about time, too, as the FED should have started cutting by 25 BPS in July.
I’ve given up trying to predict the future I just react to the present. 25 points is expected. 50 points might create unexpected consequences which I’ll respond to when they happen.