What June Jobs Report Could Mean for Interest Rates
What did the June employment report reveal about unemployment?
The June employment report revealed that unemployment rose to 4.1%, up from 4% in the previous month, marking its highest level since November 2021. This indicates a cooling labor market, as job growth slowed and earnings growth decelerated, potentially influencing the Federal Reserve's decisions on interest rates.
How did wage growth trend in June?
Wage growth in June cooled as expected, with average hourly earnings rising 0.3% for the month and slowing to 3.9% on an annual basis. This came as the work week for all employees on private nonfarm payrolls continued to average 34.3 hours, remaining consistent for three consecutive months and falling at the lower end of what's typically clocked during a healthy labor market.
What are the Federal Reserve's two main goals?
The Federal Reserve's two main goals, often referred to as the "dual mandate," are to maintain low, stable inflation and a strong labor market4. These objectives are pursued through monetary policy, primarily by adjusting interest rates to either stimulate or restrain economic growth.