On Interest Rate Cuts and Job Growth

Last Wednesday, August 21, 2024, the Labor Department announced that it had overstated job growth by more than 800,000 for the 12-month period ending in March. The preliminary figures suggest employers added about 174,000 jobs per month during that period, down from the previously reported pace of about 242,000 jobs, a downward revision of about 28 percent.  Any evidence of a slowdown makes the case for the Federal Reserve to get more aggressive with rate cuts. At its annual meetings in Jackson Hole, WY last Friday, Chairman Jerome Powell said, “the time has come for policy to adjust,” before referring to rate “cuts” in the plural. Meeting minutes from their July meeting showed that the Federal Reserve already seemed committed to a September cut.