The Bureau of Labor reported that the US economy added 206, 000 jobs last month, slightly more than the 190,000 expected by economy analysts. While that number is good, it shows a sharp decrease from the 272, 000 jobs added in May.
What this means for the economy
Overall, the economy remains surprisingly resilient in the face of the highest Federal funds rate in 22 years. Economists and investors’ predictions for 2024 had been mostly dire with some calling for a recession and a major hit to company profits.
It appears as though the Federal Reserve has so far managed to execute a “soft landing” for the economy. Meaning, they were able to raise interest rates to tamp down inflation without damaging the economy.
What this means for Investors
Investors have been watching both inflation and jobs numbers with bated breath, trying to anticipate the Federal Reserves next move. A strong uptick in either/or inflation numbers or job creation could spur the Fed to at best, keep interest rates high for a much longer than anticipated timeframe, or at worse, they could raise the rate even higher.
For an deeper dive on how the Federal funds rate effects you, check out my article “What’s all the Commotion about Interest Rates?
Originally reported by Axios “The Labor Market is Losing Steam” July 5, 2024
