Nonfarm payrolls benchmark revisions revised from +242K to -818K...
This was the worst revision correction since 2009.
Economists had predicted that U.S. nonfarm payrolls figures would be revised lower than previous figures that showed 2.9 million jobs added in the year ending in March, or 242,000 jobs added in the month.
Disclosure of data#Bitcoin and stocks have rallied but are now trading at or near pre-data levels.
- Positive views on the 818 thousand job loss are as follows:
1) #Fed 'and#faiz provides the opportunity to reduce rates
Although the probability of a rate cut in September and 3 rate cuts on the dot plot was not strong, it is stronger now.
2) A lower base
So going into March, there were 818,000 fewer jobs. Maybe now that will open the way for the economy to add 818,000 jobs without creating more inflation than we already have.
3) The economy is in good shape with 818 thousand fewer workers
OK, the job market wasn’t as strong as one might think. So what? GDP growth was good and corporate profits were great. What’s the problem with a few fewer workers? Unemployment is still historically low, which is keeping a lid on wages.
4) #Enflasyon is already dead
US inflation is trending down and will only get better. WTI crude is currently trading at $73.55, which compares to a September-October 2023 range of $85-95. This will create very rosy annual comparisons that will push CPI to or very close to 2%. It also gives housing inflation (or outright deflation) time to enter the numbers, as these are far behind.
When you put it all together, the path appears clear for the Fed to cut rates at every meeting until they reach 3%. And if the outlook worsens, there's the option to go faster -- a real Fed idol.
Summary:
All of this points to what markets have been saying for the past two weeks: a weaker U.S. dollar, lower bond yields, stronger stocks and #kripto currencies.