"The dismal August jobs report has now put a half-point September rate cut "in play," according to some analysts, while others caution that inflation pressures from tariffs make a 50-basis-point cut unlikely. Futures tied to the Fed's benchmark rate put odds of a half-point cut at around 11.7% after the jobs data, up from 0% on Thursday. The case for a bigger rate cut is gaining momentum."
"Nonfarm payrolls rose by just 22,000 last month, shooting far below expectations of 75,000. Revisions also erased gains from earlier in the summer, leaving June as the first month of outright job losses since 2020. The three-month average of payroll growth slowed to just 29,000, underscoring what EY-Parthenon's Lydia Boussour called cracks "in the economy's main pillar - the labor market." The unemployment rate also ticked up to 4.3%, the highest since October 2021."
August nonfarm payrolls rose by only 22,000, far below the 75,000 forecast, with revisions erasing earlier summer gains and leaving June as the first outright job-loss month since 2020. The three-month average of payroll growth slowed to 29,000 and the unemployment rate climbed to 4.3%, the highest since October 2021. Futures tied to the federal funds rate priced roughly 11.7% odds for a 50-basis-point September cut, up from zero percent. Views are divided: some see labor-market weakness as warranting a larger cut, while others emphasize tariff-driven inflation pressures that make a 50-basis-point move unlikely.
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