U.S. Outlook: It’s all about the jobs
The July jobs report came in close to what we and the consensus expected. There is nothing in the report that should dissuade the FOMC from an initial rate increase in September.
- There is little to suggest that August job growth will suddenly stall.
- As the unemployment rate continues to drop, we expect further acceleration in the average hourly earnings in the months ahead.
- Perhaps the strongest signal of improving economic conditions comes from the ISM non-manufacturing index, which hit its highest level of the expansion in July.