The May jobs report revealed impressive strength and breadth in U.S. job creation that blew away most economists’ expectations.
Employers added 223K non-farm jobs in May — a big step up from April’s 159K gain.
For more on this, see highlights of my report below, followed by a link to the full U.S. Outlook, delivered on June 1.Key observations:
- If you remember only one number from today’s report, it ought to be 3.8%, which is the unemployment rate for May and the lowest in 18 years.
- This labor market tightness is gradually moving the needle on national wage growth, too.
- From the Fed’s perspective, we are absorbing labor market slack at an impressive pace that is not sustainable without fueling a jump in wage and price growth if it continues in the months ahead.
- The probability of four rate hikes in 2018 would be a lot higher today if it weren’t for the downside risks in the second half of the year from an escalating trade war.
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The Fed no longer has the crutch of a moribund global economy to blame for not embarking on monetary policy normalization.Read More ›
The FOMC failed to blink in the face of widespread market skepticism about the Fed’s projected fed funds rate path as it increased the fed funds target range by a quarter percentage point today to between 1.0 and 1.25%.Read More ›
While the headline number was a disappointment, the details in the report revealed underlying labor market strength and momentum.Read More ›
The Federal Reserve raised the fed funds target rate range today by a quarter percentage point to 0.75 to 1.00% from 0.50 to 0.75%, as expected. There was one dissent in the Federal Open Market Committee (FOMC) decision, as Neel Kashkari preferred to maintain the existing target range for the Fed funds rate. The move […]Read More ›