U.S. job growth likely slowed in July after outsized gains in the prior month, w...
WASHINGTON - U.S. job growth likely slowed in July after outsized gains in the prior month, with wages probably maintaining their moderate pace of increase, which could boost market expectations for another interest rate cut from the Federal Reserve next month.
Fed Chairman Jerome Powell described the widely anticipated 25-basis-point cut as insurance against downside risks to the 10-year old economic expansion, the longest in history, from trade tensions and slowing global growth. Powell said the move was “not the beginning of a long series of rate cuts,” but also added that he was not saying “it was just one.”
Financial market expectations for a rate cut in September jumped on Thursday after President Donald Trump announced an additional 10% tariff on $300 billion worth of Chinese imports starting Sept. 1 after negotiators failed to kick start trade talks between the world’s two largest economies. July payrolls would mark a further deceleration in job growth from an average of 223,000 per month in 2018.
Average hourly earnings are forecasting rising 0.2% in July, after a similar increase in June. That is expected to have kept the annual increase in wages at 3.1% in July for a third straight month. The trend in wage gains has slowed from late 2018 when wages were rising at their fastest rate in a decade.
The retreat in job growth in July is expected to have been concentrated in the goods producing sector of the economy and government, after strong gains in June, which were not supported by other data.
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