In this morning’s data, the economy added 187,000 jobs in July, a bit less than expected and the previous month was revised lower. The Health Care and Social Assistance industry was again relatively strong, while Temporary Help was relatively weak. The Unemployment Rate ticked one-tenth lower to 3.5% and the Labor Force Participation Rate at 62.6% is the same as the previous month. Average Hourly Earnings increased 0.4% in July, slightly higher than expected, and grew 4.4% on an annual basis. In addition, Average Weekly Hours were 34.3, which is one-tenth lower than the previous month.
Overall, another increase in the headline jobs number, albeit slightly below expectations, coupled with a tick lower in the unemployment rate. The labor market still appears firm, but headline jobs are at a lower level than previous months. In addition, wages continue to grow on an annual basis above historical levels and recent reports show inflation measures are moving lower, but still above the Federal Reserve’s targets. Given these dynamics, future monetary policy decisions will be key for the direction of consumer spending, company earnings, and the economy in the coming months.
Following the release of the jobs report, the yield on the U.S. 10-year treasury ticks lower overall and equity futures are slightly higher as we head into the market open.
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