Friends
This morning’s employment numbers were better than expected once again. In March 303,000 new jobs were created vs. the 200,000 expected, and the unemployment rate fell back to 3.8% after ticking up to 3.9% last month. Average hourly earnings came in as expected up .3% in March and 4.1% year over year. These are pretty strong employment numbers folks, and unfortunately for the Fed, probably makes their job more complicated. We have talked about the anticipation of a more dovish monetary policy for 2024 but what is unfolding is the “higher for longer” mantra that we heard from Fed officials last year. Given the strength in the economy and the possible subsequent inflationary pressures that goes along with that, the Fed has a lot of thinking and messaging to do in the coming weeks and months.
The markets are taking it all in stride in early trading. I’m going to be out this afternoon, but we’ll let you know how the day plays out. I just wanted to touch base this morning given the importance of this employment number and how it might affect the Fed’s monetary policy decisions in the near term.
Have a great day everyone and a great weekend too.
Jim
