August Employment: Break in the Heat

Source: Economics Group of Wells Fargo Bank, N.A.Summary August’s jobs report was weaker in the best way possible as far as the Fed is concerned, and may be just what the inflation doctor ordered. Nonfarm payroll growth slowed to a still robust 315K gain, the unemployment rose to 3.7% due to a large jump in the labor force that more than surpassed a solid increase in household employment, and average hourly earnings growth eased slightly. Today’s data in isolation tilt the scales toward a 50 bps hike at the FOMC’s September meeting, but does not on its own settle the matter. While the August jobs report keeps hope alive that the Fed may be able to pull off the elusive soft-landing, there remains significant work ahead in quelling the inflation pressures coming from the labor market. READ FULL ARTICLE>>