FOMC & 800K Fewer Jobs Dragging on Dollar The dollar is under pressure, with persistent selling pressure driving it to new yearly lows across several currencies, including the pound.
A recent revision of jobs data revealed that U.S. job growth was significantly weaker than initially reported, with 818,000 fewer jobs added (for the year ending March 2024). This huge downward adjustment, the largest since 2009, indicates that the labor market cooled more rapidly than previously thought.
These revised job figures could likely intensify concerns that the Federal Reserve has been too slow in lowering interest rates.
At its July meeting, Federal Reserve officials considered the possibility of a rate cut but opted to hold off, hinting at a move in September. Markets are now pricing in a September cut, which would be the first since the emergency measures taken during the early days of the Covid crisis.
Regarding the labor market, “many” officials noted that “reported payroll gains might be overstated,” which means that the Federal Reserve might be ahead of the rest of us, and exactly where it wants to be regarding timing the rate cuts.
