On the June Jobs Report
With downward revisions to an already anomalously bad May jobs report, the June report takes us from the worst month since the end of the Great Recession to the best, back-to-back. Unofficial indicators of the labor market imply that the two months really weren’t that different. This should dispel false fears from May’s report that the US economy is slipping into recession, when in fact it is emerging from a two-quarter mini-recession. This will confirm the Fed’s skepticism about last month’s bad numbers, but only deepen its sense of uncertainty, now in the data itself – on top of the many unknown unknowns arising from Brexit. No rate hikes this year.