US job growth in the year through March was likely far less robust than initially estimated, which risks fueling concerns that the Federal Reserve is falling further behind the curve to lower interest rates.
Goldman Sachs Group Inc. and Wells Fargo & Co. economists expect the government’s preliminary benchmark revisions on Wednesday to show payrolls growth in the year through March was at least 600,000 weaker than currently estimated — about 50,000 a month.
While JPMorgan Chase & Co. forecasters see a decline of about 360,000, Goldman Sachs indicates it could be as large as a million.
The Fed has all the numbers. And they see them before we do. Basically, it’s really simple at this point (and Powell will allude to it later this week at Jackson Hole) … if the decline is 360,000 then we get a quarter point rate cut in a few weeks … if the decline is really a million, we might see a half point rate cut in a few weeks. But we will see some sort of rate cut. At least, that’s my best guess.
Yes there will and it will sturm und drang about nothing. Fed moves on interest rates take weeks, usually months to have any effect on the economy, with the possible exception of high rollers at the craps tables on Wall Street. The market may get a pop, but banks aren’t going to be overwhelmed because mortgage rates go from 7.5% to 7.25%. In fact, most people will wait for another cut and another unless they are forced by fate and circumstance to buy right now, today.
Bond traders will try to go longer (but not too long)to capture yesterday’s higher rate, but that will lead to demand, which will bounce the market some. So sure there will be a little bit of wiggle, but absent large, immediate moves t will not affect the economy by November, certainly, maybe not even until 1st quarter ‘25.
Much ado about nothing. Of course that’s 95% of politics so…