Federal Reserve: Fed focus shifts to jobs – ABN AMRO
ABN AMRO’s Chief Economist Nick Kounis highlights renewed US labour market weakness, with Nonfarm Payrolls falling and household employment data softening. He notes the unemployment rate declined as labour force participation dropped to multi-decade lows, signalling cyclical weakness.
ABN AMRO's Chief Economist, Nick Kounis, has pointed out a shift in the Federal Reserve's focus towards jobs following a decline in the US labour market. The Nonfarm Payrolls fell by 23K in July, with downward revisions to previous months resulting in a mere 20K average monthly gain in employment. Falling labour force participation, while partly structural, often signals cyclical weakness in the labour market.
The data suggest that some recent payrolls strength may have been temporary. This could prompt the Fed to prioritize employment concerns, although ABN AMRO still anticipates the central bank to maintain a hold on monetary policy. High inflation still poses risks, leading to a potential hike.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
