Tonight's employment data is expected to show a slight increase in the unemployment rate, a small rise in employment numbers, and a slight decline in year-on-year income, with month-on-month figures remaining unchanged.
Overall, the data is considered to be relatively "good" in the current context, a "double-edged sword".
This can both solidify the interest rate easing path for the next few months and will not raise concerns about the downside risks in the employment market data.
In comparison, many institutions and professionals believe that worse data would bring expectations of a 50 basis points rate cut, which is a good thing,
However, I believe that worse employment data could be a "double-edged sword"; while it may increase the rate cut magnitude in September, it is also likely to raise concerns about future employment data, and even worries about stagflation and economic recession.
In contrast, I believe the current data is more stable, consolidating rate cuts without bringing systemic risks to the employment market.
Currently, it is clear that many people do not think so, even "the one who understands" feels this way,
Before the data was released, "the one who understands" eagerly expressed doubts about the "real" employment data, believing that real figures would take a year to ascertain.
This conveys two signals:
1. The nomination of the Director of the U.S. Bureau of Labor Statistics is not going smoothly; although Trump is pressuring the Senate, the Senate is prioritizing the nomination of Federal Reserve Board members, clearly indicating what is more important, which Trump himself knows.
2. What does Trump want the data to show? At this moment, a slightly weakening employment data would better align with Trump's desire for rate cuts, yet Trump questions the employment data. However, if he wants the employment data to prove that the U.S. economy is "good", it would be contrary to his desire for rate cuts.
At least, at this moment, Trump confuses me; if he doesn’t speak out, waiting for Powell to step down, then control the Federal Reserve to cut rates, and then question the employment data, "correcting" the employment data to his satisfaction clearly aligns better with the plan itself.
If we say Trump doesn’t understand, nor is he rigorous, after all, his team includes people like Bessent, so does "the one who understands" really "understand"? Or do we just not "understand"?
