The Slowdown We’ve Been Waiting For
Wage-growth pressures appear to be easing.
Investors, traders, and speculators bid up stocks on Friday in renewed anticipation of a September rate cut after the April employment situation report from the Bureau of Labor Statistics showed some softening in the labor market.By “softening” we’re talking about an economy that added 175,000 jobs last month and an unemployment rate that ticked up to 3.9 percent from 3.8 percent.
It’s true that hiring slowed compared to March. But that number was revised upward to 315,000. And the unemployment rate has been below 4.0 percent for more than two years, the longest such streak since the 1960s.
The labor force participation rate was stable at 62.7 percent.
Average hourly earnings were up 0.2 percent from March and 3.9 percent year over year, trailing forecasts of 0.3 percent and 4.0 percent but giving further comfort to those hungry for signs of easing inflation pressures.
Is this the slowdown we’ve been waiting for?
Richmond Fed President Tom Barkin and New York Fed President John Williams are up today.
If one appearance more than any other is likely to move markets, it’s Minneapolis Fed President Neel Kashkari’s conversation with New York Times Federal Reserve and economics reporter Jeanna Smialek at the Milken Institute’s annual conference tomorrow at 11:30 a.m. ET.
We’ll also hear from Fed Vice Chair Philip Jefferson, Boston Fed President Susan Collins, and Fed Governor Lisa Cook on Wednesday.
San Francisco Fed President Mary Daly speaks on Thursday.
Fed Governor Michelle Bowman, Chicago Fed President Austan Goolsbee, and Fed Vice Chair for Supervision Michael Barr close out the week with public appearances on Friday.
Investors, traders, and speculators will of course want to know what the latest numbers mean for their inflation forecasts.
As far as incoming data, we’ll see consumer credit for March on Tuesday, wholesale inventories for March on Wednesday, initial jobless claims for the week ended May 4 on Thursday, and the University of Michigan consumer sentiment index for May and monthly US federal budget figures for April on Friday.
Earnings reporting will continue – and numbers so far have been good for morale – with Palantir Technologies $PLTR and Tyson Foods $TSN up today.
BP $BP, Occidental Petroleum $OXY, and Walt Disney $DIS will report on Tuesday. Airbnb $ABNB, Anheuser-Busch InBeV $BUD, and Uber $UBER are up on Wednesday.
Warner Bros. Discovery $WBD reports on Thursday and Honda Motor $HMC. reports on Friday.
