I am sticking with my call of a 50 basis point cut by the Fed this month. The Jobs report on Friday and the CPI report next week will determine the fate.
Tomorrow ADP will provide a preliminary indicator to the BLS job report on Friday.
If the jobs report is weak enough or the next CPI report is favorable enough, the Fed will cut 50 basis points on September 18. A quarter-point cut is baked in the cake.
If the Fed doesn’t cut by 50 basis point, my next bet is the Fed will regret that decision in October.
There is no FOMC meeting in October.
I am working on a CPI forecast now. I expect a very rate-cut friendly report on September 11, details coming up.
Nearing the Point Where Unemployment Is Greater Than Job Openings
Meanwhile, please note we are Nearing the Point Where Unemployment Is Greater Than Job Openings
Since I think openings are inflated, I suspect we have already hit the tipping point.
Finally, I suspect but cannot prove that many firms are holding back layoffs until after the election. If so, all hell will break loose in November or December.