Job Numbers Revised
The 818,000 downward revision to U.S. payrolls has sparked debate about its economic implications, but current signals suggest a recession is not imminent. Unlike in 2009, when similar revisions coincided with a declared recession, key indicators such as jobless claims and GDP remain stable. The revisions may indicate that job growth was overstated, bringing average employment growth down slightly, but they do not align with broader signs of economic weakness. While the revisions might modestly influence future Federal Reserve rate cuts, the Fed is likely to prioritize current data over these backward-looking revisions.
The Fed Meets In Jackson Hole
Federal Reserve Chair Jerome Powell hinted that an interest rate cut is likely imminent, prompting market speculation on the timing and size of the cut. Traders expect the Fed to start an easing campaign with a 25 basis point reduction in September, though there is a growing chance of a more aggressive 50 basis point cut, especially if the upcoming August jobs report is weak. Powell’s comments at the Jackson Hole symposium suggest a readiness to support the economy as inflation cools, with the potential for faster rate reductions if job growth continues to slow. Market participants see the possibility of cutting the federal funds rate to 4% through successive 50 basis point cuts over upcoming meetings.
Robert F Kennedy Jr Drops Out
Robert F. Kennedy Jr., the independent presidential candidate, has ended his campaign and endorsed Donald Trump, citing his lack of a realistic path to victory and a desire to avoid being a spoiler. Kennedy's announcement came first in a court filing in Pennsylvania, followed by a speech in Arizona, where he stated he would remove his name from ballots in battleground states. Trump's endorsement was criticized by Kennedy's family, who denounced RFK Jr’s support for Trump as a betrayal of the Kennedy family’s values. Kennedy Jr., known for his conspiracy theories and anti-vaccine stance, has faced numerous controversies throughout his campaign and has positioned himself alongside Trump against what he describes as a biased media and political establishment.
