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Jobs report rebounds in June; rate cut still possible
NAFCU Chief Economist and Vice President of Research Curt Long noted that Friday's jobs report – with 224,000 jobs gained in June – reveals moderate economic growth, specifically in labor force participation, but he still expects the Federal Open Market Committee to cut rates later this month.
"Hiring is back on track after a one-month dip," said Long. "The June report was generally positive and included gains in labor force participation. Investors hoping for added ammunition to support their expectations of multiple rate cuts this year – or even a 50-basis point cut later this month – will be disappointed. A 25-basis point insurance cut is still on the table in July, but beyond that NAFCU sees no reason to expect further easing this year."
The unemployment rate rose slightly from 3.6 percent in May to 3.7 percent in June, while the labor force participation rate increased 0.1 percentage point to 62.9 percent.
In other report data, private-sector payroll employment increased 191,000 jobs during June. The goods-producing sector increased 37,000 jobs, while the service sector increased 154,000 jobs. Public sector employment rose 33,000 from the prior month.
Average hourly earnings increased 6 cents to $27.90 in June. Over the last 12 months, wages are up 3.1 percent.