July 8

7/8 – Last week, the Labor Dept said that U.S. employers added 206,000 net new jobs in June. Despite the higher-than-expected job gains, the unemployment rate still rose from 4.0% to 4.1% as more Americans got off the sidelines and started looking for jobs. That broke a 30-month stretch of unemployment at or below 4%. New claims for unemployment are creeping up (but are still historically low) at 238,000 for the last week of June – following a 2-year average of 218,587 per week for 2022/23. The labor force participation rate at 62.6% remains below pre-Covid levels of 63.3%, mostly due to a tidal wave of retiring boomers. The good news is that a modestly cooling jobs market is a bit of a relief following 3 years of hiring difficulties. And the rising unemployment rate gives the Fed an excuse to cut interest rates. According to the CME’s FedWatch Tool, the current odds of at least one rate cut by Sept is now 77.9%.