{"id":9486,"date":"2025-09-11T12:44:06","date_gmt":"2025-09-11T12:44:06","guid":{"rendered":"https:\/\/www.newsbeep.com\/il\/9486\/"},"modified":"2025-09-11T12:44:06","modified_gmt":"2025-09-11T12:44:06","slug":"job-market-revisions-keep-adding-pressure-on-fed-to-cut-rates","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/il\/9486\/","title":{"rendered":"Job market revisions keep adding pressure on Fed to cut rates"},"content":{"rendered":"

WASHINGTON (TNND) \u2014 More revisions to federal data are revealing the labor market was on weaker footing than initially thought to start the year as hiring has stalled out <\/a>over the summer and created concerns about cratering further as the Federal Reserve appears likely to make the first rate cut since last year at its meeting next week.<\/p>\n

The Labor Department said this week that the economy added 911,000 fewer jobs than previously estimated for the 12 months ending in March, erasing about half the gains that were originally thought. The slowdown has continued since the spring when President Donald Trump announced his sweeping \u201cLiberation Day\u201d tariffs, with job creation stalling and the unemployment rate ticking upward.<\/p>\n

Last week\u2019s jobs report missed economists\u2019 expectations with companies adding just 22,000 jobs in August.<\/a> A revision to previous data also revealed the economy lost jobs in June, the first since the end of 2020 when the pandemic was raging.<\/p>\n

The central bank\u2019s benchmark rate has been stuck in place since last year as it tried to get inflation back to its target level of 2%, a benchmark it has been unable to crack since the pandemic. But the stalling of the labor market is recalibrating the Fed\u2019s priorities toward trying to protect the labor market from going into a tailspin.<\/p>\n

\u201cThe Fed is so data dependent that based on the data they have, they’ve made the best decision they could,\u201d said Mark Williams, a finance lecturer at Boston University\u2019s Questrom School of Business and former bank examiner at the Fed. \u201cThe debate will be whether it’s 50 (basis points) or whether you do 25 and to save some powder for next meeting.\u201d<\/p>\n

The Fed was already widely expected to cut rates at the September meeting to keep the labor market from falling off a cliff prior to the August jobs report and the revisions, which have put those expectations into overdrive. Wall Street sees a 0.25% rate cut as a certainty and increased odds of a more aggressive half-percentage point cut.<\/a><\/p>\n

Last year, the Fed cut rates by 0.5% over concerns about a tumbling job market that Fed chairman Powell said was an effort to keep employment and economic growth on track. While investors see chances of a more aggressive cut increasing with lousy jobs data, the Fed may be hesitant to send that signal.<\/p>\n

\u201cThe Fed is going to be very sensitive about avoiding a 50-basis point cut this meeting,\u201d Williams said. \u201cThat would send the negative sign to the market that the Fed’s concerned about a recession.\u201d<\/p>\n

A string of poor labor market data has also increased the odds the Fed will need to make more cuts than initially anticipated and how whether the economy will continue to hold up under the weight of inflation and economic uncertainty brought by tariffs and whiplash trade policy from the White House.<\/p>\n

\u201cThe consequences of this larger-than-expected revision go beyond intensifying political attacks on the BLS. They will reinforce the notion that the economy was weaker than reported and that the Federal Reserve faces an even larger risk of being behind the curve on its employment objective,\u201d Mohamed El-Erian, chief economic adviser at Allianz, said in a post on X.<\/p>\n

Trump has criticized Powell for being \u201ctoo late\u201d to cut rates and called for massive reductions in the benchmark rate to boost the economy and reduce costs to the government to service the federal debt.<\/p>\n

The White House is trying to get the GOP-led Senate to confirm his nominee to replace now-departed Fed Governor Adriana Kugler in time for next week\u2019s meeting, which moved forward Wednesday morning after the nomination was advanced out of a Senate committee. Trump has also taken the unprecedented step of trying to fire Governor Lisa Cook over allegations of mortgage fraud in a move that could open another position on the board to nominate someone who supports his case for cutting rates.<\/p>\n

The BLS has also been caught in the crosshairs of the fight after large revisions in the July jobs report initially sounded alarms on a stalling labor market. Trump immediately moved to fire the labor statistics agency\u2019s leader over claims of politicizing the data and nominated Heritage Foundation chief economist EJ Antoni to replace her.<\/a><\/p>\n

Revisions to the labor data have fueled the White House\u2019s criticisms to overhaul BLS and on the central bank to cut rates.<\/p>\n

\u201cThis is exactly why we need new leadership to restore trust and confidence in the BLS\u2019s data on behalf of the financial markets, businesses, policymakers, and families that rely on this data to make major decisions. Much like the BLS has failed the American people, so has Jerome \u2018Too Late\u2019 Powell \u2014 who has officially run out of excuses and must cut the rates now,\u201d White House press secretary Karoline Leavitt said in a statement.<\/p>\n","protected":false},"excerpt":{"rendered":"WASHINGTON (TNND) \u2014 More revisions to federal data are revealing the labor market was on weaker footing than…\n","protected":false},"author":2,"featured_media":9487,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[114,9575,4318,85,932,46,4863,3535,190,10422,10423,2844],"class_list":["post-9486","post","type-post","status-publish","format-standard","has-post-thumbnail","category-markets","tag-business","tag-economic-growth","tag-federal-reserve","tag-il","tag-inflation","tag-israel","tag-job-market","tag-labor-data","tag-markets","tag-rate-cut","tag-revisions","tag-unemployment-rate"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/9486","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=9486"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/9486\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/9487"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=9486"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=9486"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=9486"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}