Daily update
Daily update
- Just one month ago, markets were panicked by the release of an unreliable labor market signal, distorted by seasonal peculiarities. Now, once again, it is time for the US employment report. The unreliability adds unpredictability to the numbers, but the expectation is for a lower unemployment rate as temporarily unemployed auto-sector workers return to work.
- Two things matter about the US labor market, and neither appears in today’s data. Middle-income consumers’ fear of unemployment dictates their consumption patterns. Fear of unemployment should be low (firms may slow hiring, but they are not accelerating firing). The data will be spun by both parties, but most US voters do not know what the last payrolls figure was—labor market perceptions, not reported data, were what matter politically.
- In a well-run central bank a, single employment statistic would not change policy. Under Federal Reserve Chair Powell’s “data dependency” mantra, the tone of this report could influence the size of the September rate cut. New York Fed President Williams speaks after the data.
- French President Macron has appointed former Brexit negotiator Barnier as prime minister. He has had some experience crafting deals with right wing politicians guided by an overarching ideology. Le Pen’s Rassemblement National has signalled no immediate desire to vote against Barnier.
