ALBAWABA – Economists anticipate hiring in the United States (US) to have slowed to a still moderately high but healthy US labor market growth rate in July, Bloomberg reported Saturday.
The US jobs report, coming out Friday, is projected to show that employers boosted payrolls by 200,000 in July, with unemployment at a historical low of 3.6 percent, the news agency reported.
Separate data indicate less job openings in June, which indicates a better balance in the labor market, according to Bloomberg.
The US labor report comes on the heels of a surprising acceleration in second-quarter economic growth, reports have shown. While recession risks remain, so far the US economy has proved resilient to higher interest rates and rising inflation. Unlike the decline in greater Europe and the sluggish economy in China.
Federal Reserve Chair Jerome Powell, after the Fed boosted US interest rates by a quarter point this week, said Fed economists are no longer forecasting a recession in 2023.
Meanwhiel, Christine Lagarde, head of the European Central Bank, said the outlook for Europe has “deteriorated.”
“We’re not in the camp expecting a soft landing — which the Fed has achieved only once in the past half-century,” Anna Wong, Stuart Paul and Jonathan Church, told Bloomberg.
“The disinflation seen in recent data doesn’t reflect the death of the Phillips Curve or an anomalous break between net demand and prices. Rather, it’s because there are real cracks in the economy. Long after supply chains have normalized, it’s a downdraft in demand that’s driving the current wave of disinflation,” they said.
The steadfast US labor market has been a key driver of the economy as the Fed kept tightening monetary policy to contain inflation. The government’s June job openings data on Tuesday are projected to show the fifth decline in six months, consistent with some softening in labor-market conditions that will help restrain price pressures, according to Bloomberg.
Among other US economic data this coming week are Institute for Supply Management purchasing managers surveys at manufacturers and service providers. On Monday, the Fed will issue its senior loan officer survey that will help gauge the credit fallout from the central bank’s rate hikes.
