Wall Street’s Dream Bulletproof economy President Donald Trump’s trade war may have been ruined, but market veteran Ed Yardeni strengthened his positive attitude in an otherwise frustrating job report.
That’s it Salary increased by 73,000 last monthwell below the forecast of about 100,000. Meanwhile, May’s Tally fell from 144,000 revisions to 19,000, while the total in June cut from 147,000 to just 14,000, which means the average growth in the past three months is now only 35,000.
Yardeni Research President Yardeni admitted in a report on Monday that the report was shocking, but that he maintained the labor market was still resilient.
“It’s hard to make an aggressive spin on this news, but not for us!” he wrote.
Yardeni noted that the total number of hours increased and the average working week in the private sector. In addition, private industry wages have made healthy progress and reached record highs.
Meanwhile, he attributed some of the slowdown in the payroll to a declining supply of workers rather than reducing demand for workers.
The labor force has stopped growing in recent months due to Trump’s immigration crackdown. At the same time, the scale of labor demand has tracked supply trends so far this year, which is an unusual phenomenon, Yardeni explained.
“This means that weak wages in recent months may be related to labor supply,” he added. “Users insist on hiring employers may temporarily weaken until Trump’s tariff turmoil.”
By contrast, JPMorgan economists interpret the work data as Weak demand Suitable for workers.
In a note Friday night, they downplayed the increase in wages and average work weeks, while noting that over the past three months, the private sector has hiring rates have dropped to an average of 52,000, while the health and education stagnant sectors are stagnating.
“We have always stressed that the sliding of labor demand at this scale is a warning sign of a recession,” JPMorgan added. “Companies typically maintain the benefits of hiring by what they think is a brief growth downshift. It is often a pioneer in layoffs when labor demand slides downshifts with growth downshifts.”
The note also warns that frustrated jobs are unlikely to maintain income income.
Bank of America In itself, the shock of labor demand will lead to wage growth and slowing working hours. That didn’t happen. While the demand is not clear, much faster than supply, these working data look more like supply than the demand shock so far, BOFA said.
At present, even if recruitment has cooled sharply, there is no sign of massive layoffs, and the unemployment rate has barely changed, with over a year and bounced in the 4% to 4.2%.
The economy is still seen as persistence. this Atlanta Fed’s GDP Tracker Points for continued growth, although expected to drop from 3% in the second quarter to 2.1%.
The issue of supply and requirements may be the key to the Fed’s response to work data. Wall Street will soon bet on the Fed to lower tax rates, given Monday’s stock market rally and continues to drop treasury yields.
Job creation is no longer solid, and when combined with the headwinds of Trump’s trade war, recent data suggests that the Fed is closer to lowering interest rates, JPMorgan said.
Meanwhile, BOFA supported the forecast that the Fed would not lower interest rates this year, and Yardeni also reiterated his view on the “unparalleled” situation.
“This is because we expect the next batch of inflation indicators to indicate that tariffs are increasing consumer price inflation, especially those of durable commodities,” he added. “We also want to see more signs of life in the labor market.”
