Topic: Employment Report
Clarksville, TN – The May Employment Report was generally disappointing. Nonfarm payrolls rose by 138,000 (median forecast: +185,000), while figures for March and April were revised a net 66,000 lower.
Retail payrolls fell for the fourth consecutive month (down more than 80,000 since January, which is more than the total number of coal miners). The unemployment rate dipped to 4.3%, a 16-year low, partly reflecting a sharp drop in the rate for young adults (which could reflect a seasonal adjustment issue, although the trend is clearly lower).
Clarksville, TN – The economic data were mixed. Consumer confidence rose in September. Durable goods orders were mixed. The estimate of 3Q16 GDP growth was revised higher (to a 1.4% annual rate, held back by a sharp slowing in inventory growth).
Personal income rose modestly in August, as expected, but spending was softer than anticipated, suggesting a possible loss of momentum following a strong spring and early summer (economists’ estimate of GDP growth were revised down for both 3Q16 and 4Q16).
Clarksville, TN – Fed Governor Lael Brainard, a dove, presented her case for why the central bank should delay an increase in short-term interest rates. While her views are her own (not representative of the Fed as a whole), a more hawkish tilt would have raised the odds of a September rate hike.
The key economic data reports were on the soft side of expectations, but were still consistent with moderate growth in the near term. Retail sales disappointed in August. Industrial production unwound a seasonal quirk that boosted July figures. CPI figures surprise slightly to the upside.
Clarksville, TN – The August Employment Report was a little light of expectations. Nonfarm payrolls rose by 151,000 (median forecast: +180,000), with a net revision to June and July of only -1,000. Private-sector payrolls rose by 126,000 – a +150,000 average over the last six months (vs. +221,000 in 2015 and +240,000 in 2014).
The unemployment rate held steady at 4.9% (vs. 5.1% a year ago). Average weekly hours fell (and hours for July were revised lower). Average hourly earnings rose just 0.1%, up 2.4% y/y.
Clarksville, TN – In her speech, Fed Chair Yellen indicated that “given the risks, I consider it appropriate for the [FOMC] to proceed cautiously in adjusting policy.” This dovish stance was taken well by financial market participants.
Yellen emphasized that the Fed’s projections (such as the dots in the dot plot) are expectations and “not a plan written in stone.” Fed policy decisions will remain data-dependent, but Yellen stressed that the central bank has a limited ability to respond to downside shocks to the economy.
Clarksville, TN – The economic data were mixed. The ISM Manufacturing Index remained below the break even level in January, with a pickup in new orders and a softening in employment.
The ISM’s Non-Manufacturing Index slowed more than anticipated. The January Employment Report seemed to have something for everybody. Nonfarm payrolls rose less than forecast.
However, the unemployment rate edged lower, hours moved higher and average hourly earnings advanced – all likely to catch the attention of Fed policymakers.
Clarksville, TN – The economic data were mixed, but consistent with the theme of global softness and domestic strength. Unit auto sales improved further in September – and, combined with the August data on personal income and spending, suggest that inflation-adjusted consumer spending (70% of GDP) is on track to have expanded at an annual pace of 3.5% to 4.0% in 3Q15.
The trade deficit in goods widened sharply in August, with that split evenly between stronger imports (despite lower oil prices) and weaker exports. Net exports and an inventory correction are expected to subtract significantly from 3Q15 GDP growth, but underlying domestic demand appears to have remained strong.
Clarksville, TN – The April employment report was in line with expectations. Details suggested: 1) a rebound from March weather effects; 2) some moderation in the underlying pace of job growth (relative to the very brisk pace of 4Q14); and 3) a very gradual pace of reduction in labor market slack.
Nonfarm payrolls rose by 223,000, while the weather-restrained March increase was revised down to +85,000 (from +126,000) – leaving an average monthly gain of 154,000 for March and April. The unemployment rate was essentially unchanged at 5.4%. Average hourly earnings rose 0.1%, up 2.2% year-over-year (still lackluster).
Clarksville, TN – The economic data were mixed, but the February Employment Report was stronger than expected. Nonfarm payrolls rose by 295,000 (±105,000), with a revision to January of -18,000. The BLS indicated that the payroll survey missed most of the bad weather that hit last month.
The household survey showed that 328,000 could not make it to work due to bad weather, which is about average (it was 601,000 in February 2014). Average weekly hours held steady (no weather impact).
Clarksville, TN – Greece’s reform proposals were accepted by European finance ministers, effectively kicking the can down the road for another four months.
In her monetary policy testimony, Fed Chair Janet Yellen signaled that the Fed will begin to consider raising short-term interest rates on a meeting-by-meeting basis. Before then, the Fed will change its forward guidance (currently, the language suggests that the Fed can be “patient” in deciding when to raise rates).
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