Weak U.S. Jobs Report Just Blew Up Powell’s Narrative
July’s jobs data just dropped — and it completely wrecked the “strong labor market” story Jerome Powell was trying to sell.
Nonfarm payrolls? Just 73,000.
Economists were expecting at least 100,000 — and even that would've been weak. But here’s the kicker: June’s original number of 147,000 got revised down to 14,000. That’s not a typo.
And May? Also butchered — revised from 144,000 to 19,000.
That’s a combined 258,000 jobs erased from the past two months. More than the entire population of Scottsdale, Arizona — just gone.
Meanwhile, unemployment ticked up to 4.2% — exactly as forecast, but still rising. That puts a massive hole in Powell’s credibility, especially after he told reporters just two days ago that the labor market was “still strong.” Yeah… not anymore.
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Markets Are Now Pricing In a September Rate Cut Like It’s a Lock
Right after the report hit, Wall Street didn’t hesitate.
CME’s FedWatch Tool jumped from 40% odds of a September cut to 75.5% in a matter of hours. Kalshi markets echoed the same — 75% chance the Fed caves.
Yields? The 2-year tanked 15 bps to 3.80%, and the 10-year dropped 8 bps. That kind of move screams: pivot incoming.
At this point, there are only two conclusions:
1️⃣ The job market is quietly slipping into recession.
2️⃣ The BLS data is so broken it missed a quarter million jobs in just two months.
Neither is bullish. One means pain. The other means chaos. Either way, the Fed just got exposed — and the market knows it.
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Bonus: Trump Chimes In
And of course, Trump didn’t miss the opportunity.
He slammed Powell on Truth Social, calling him “Jerome ‘Too Late’ Powell” and demanding an immediate rate cut:
> “Too Little, Too Late. DROP THE RATE! The good news is that Tariffs are bringing Billions of Dollars into the USA!”