An onslaught of economic indicators arrived this week. To summarize: higher interest rates and inflation appear to be weighing on manufacturing and construction, yet service sector activity remains fairly resilient. Financial markets were largely focused on signs that the labor market is starting to loosen. Notably, stocks rallied early in the week following a surprisingly sharp drop in job openings. According to the latest Job Openings and Labor Turnover Survey (JOLTS), the count of job openings plummeted by 1.1 million vacancies in August. The monthly decline was the sharpest drop since 2020 during the throes of the pandemic.
The JOLTS plunge will come as welcome news to the FOMC. Fed Chair Powell has frequently cited the high number of openings relative to the number of unemployed workers as indicative of a labor market that is too tight. August's plunge in openings is a sign that tighter monetary policy is starting to slow hiring, and possibly the inflation pressures stemming from rapid wage growth. The market reaction to the news was likely owed to the belief that a pivot towards less-hawkish monetary policy could be coming sooner than expected.
Given the steep drop in job openings, Friday’s employment report took on new significance. Payrolls rose by 263K jobs during September, a gain just a shade above market expectations. The monthly improvement reflects a slowing pace of job growth this year, however labor markets remain remarkably tight. The unemployment rate ticked back down to 3.5% during the month, matching a 50-year low. The dip in the jobless rate occurred alongside a solid rise in household employment and only mild decline in the labor force. The labor force participation rate, which is still hovering below prepandemic averages, inched down to 62.3%.
June 2020 Economy At A Glance
Wells Fargo Economics & Financial Report / Jun 18, 2020
The Fed expects to hold interest rates near zero through the end of this year, perhaps well into next year, and maybe even into ’22.
This Week's State Of The Economy - What Is Ahead? - 10 November 2020
Wells Fargo Economics & Financial Report / Nov 17, 2020
The U.S. election has come and gone, but we have not made any meaningful changes to our economic outlook, which continues to look for further expansion in the U.S. economy in coming quarters.
This Week's State Of The Economy - What Is Ahead? - 29 May 2020
Wells Fargo Economics & Financial Report / May 30, 2020
The beginning of this week saw some optimism that the economic downturn could be relatively short-lived, but data through the rest of the week provided grim reminder of the economic damage from COVID-19.
July 2020 Economy At A Glance
Wells Fargo Economics & Financial Report / Jul 30, 2020
The recent surge in COVID-19 cases indicates that elected officials re-opened the economy too soon, that too many Americans are flaunting social distancing guidelines, and that the virus is likely to be around longer than we’d hoped.
This Week's State Of The Economy - What Is Ahead? - 30 April 2021
Wells Fargo Economics & Financial Report / May 18, 2021
The gain in output leaves the level of real GDP just a stone\'s throw below its pre-COVID Q4-2019 level (see chart).
This Week's State Of The Economy - What Is Ahead? - 31 January 2020
Wells Fargo Economics & Financial Report / Feb 01, 2020
Mexico’s economy has slowed notably over the last year, with the economy contracting again in Q4, indicating a full-year contraction for 2019.
This Week's State Of The Economy - What Is Ahead? - 08 April 2022
Wells Fargo Economics & Financial Report / Apr 11, 2022
Wednesday\'s release of the FOMC minutes stirred things up as comments showed committee members agreeing that elevated inflation and the tight labor market at present warrant balance sheet reduction to begin soon.
This Week's State Of The Economy - What Is Ahead? - 27 September 2019
Wells Fargo Economics & Financial Report / Sep 28, 2019
The release of the transcript of President Trump\'s phone conversation with Ukraine President Volodymyr Zelenskiy and the whistle blower complaint overshadowed most of this week\'s economic reports and took bond yields modestly lower.
This Week's State Of The Economy - What Is Ahead? - 06 November 2020
Wells Fargo Economics & Financial Report / Nov 10, 2020
As of this writing, the outcome of the U.S. presidential election is undecided. Joe Biden, however, appears likely to become president based off of his growing lead in several key states.
This Week's State Of The Economy - What Is Ahead? - 27 May 2022
Wells Fargo Economics & Financial Report / May 29, 2022
it looks like higher mortgage rates are starting to have some effect on the housing market as April...
