Initially, the market expected the probability of the Federal Reserve cutting interest rates in September to be less than 40%. After the non-farm data was released, it directly reached 80%. Isn't that a solid confirmation of the September rate cut?

1. New jobs added were less than 100,000.

In July, the US reported a non-farm employment increase of 73,000, which was below the market expectation of 104,000.

If we don't look at the revised data from the past few months, we would feel that US employment has finally started to weaken.

After all, in the past eight months, the US added more jobs than expected, all above 100,000. Even with 70,000, it's still okay.

Moreover, the unemployment rate in July was only 4.2%, which isn't a big difference.

So, why did the market react so strongly?

You can look back at the data from May and June, which was very much above expectations.

The data for May was 144,000, and for June it was 147,000.

So, when the latest data is released in July, what will happen to May and June?

May was revised down to 19,000, and June was revised down to 14,000, totaling a downward revision of 258,000 over two months.

Where have all the people gone? Has it become a numbers game?

Moreover, the addition of 14,000 jobs is comparable to the situation during the pandemic in 2020, which did not occur in other years.

Ask, is this data reasonable?

Even the US Labor Department had to explain that the revisions for these two months exceeded normal levels.

If you say there's nothing to hide, who would believe it?

A large part of this comes from the revision of government employment.

June's data exceeded expectations. At that time, we mentioned that government employment was key, and over the past six months, government employment has been surprisingly good, especially considering the layoffs in the Efficiency Commission.

Now, the revised data has completely fallen apart. The new jobs added in April and June have both turned negative.

Isn't it ridiculous?

2. The US dollar has plunged below 99.

During this period, the US dollar was still quite strong.

On one hand, Trump's tariff trade policy has increasingly succeeded in achieving its goals.

On the other hand, many data points from the US are performing well.

The dollar index briefly rose above 100 in these two days.

As a result, there was a big move, and it directly fell below 99.

Gold has also surged, after being suppressed for too long, especially with significant adjustments in the past two days.

This breath that has been held in has finally been released.

US Treasury bonds have taken a nosedive, with the 10-year Treasury yield directly falling over 10 basis points, dropping below 4.3% and approaching 4.2%.

3. Has the rate cut been confirmed?

Originally, the market expected the probability of the Federal Reserve cutting interest rates in September to be less than 40%. After the non-farm data was released, it directly approached 80%.

Isn't that a solid confirmation of the September rate cut?

Originally, everyone expected one rate cut in October.

Isn't it that after the rate cut in September, the market believes there will be further cuts?

So, it was originally very firm, and it wasn't certain that there would be an interest rate cut in September, as the data was quite good and employment was good.

Just like last September when the rate cut exceeded expectations by 50 basis points, when a rate cut is about to happen, the data suddenly turns bad.

So, brothers, who is the non-farm data saving?