5 September 2025
If you are covering the latest US jobs data, please see the following comment from Richard Carter, head of fixed interest research at Quilter Cheviot:
“Markets have been pricing in a 0.25% rate cut at the Federal Reserve’s upcoming monetary policy meeting, and today’s softer than expected jobs number may well grant that wish. Total nonfarm payroll employment shows August saw an increase of just 22,000, down markedly from a revised 79,000 in July and far below estimates. Meanwhile, the unemployment rate rose slightly to 4.3%.
“Last month’s payroll data showed large downward revisions to previous months, with May and June’s employment numbers dropping by a combined 258,000 from initial estimates. Today, we have seen a further downward revision to June’s total, taking it from an increase of 14,000 to a decrease of 13,000, and a modest 6,000 upward revision to July’s figure.
“Earlier this week, jobless benefit claims ticked higher, and today’s worse than expected payrolls figure cements the fact that the jobs market is weakening significantly. Following the Fed’s decision to hold rates in July, markets had already largely priced in a cut, regardless of today’s numbers. Still, one major obstacle remains. Inflation continues to complicate the Fed's path, and next week’s CPI print will be critical, especially as several FOMC members remain cautious about easing policy under political pressure. With the full impact of Trump's tariffs still unfolding, a hotter than expected inflation reading could lead to a split decision later this month.”
