The Federal Reserve could be set to see as many as a million US jobs completely vanish in what would be the largest downward revision in 15 years. Indeed, a Bloomberg report notes that job growth through March was far less robust than initially estimated,” preceding the potential revision.
The Federal Reserve faces concerns that it is behind the curve in curing interest rates. Currently, they are slated to cut the 23-year high rates at their September meeting. Yet, the revised employment data would be a concerning development. Specifically, questioning the Fed’s approach to this point.
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Fed Faces Largest Downward Revision to US Jobs Data in 15 Years
There is no denying the fragility of the current US economy. Its ongoing inflation fight has driven interest rates to monumental highs. Moreover, concerns over a potential recession have been ever-present. Those fears drove a $2 trillion stock market crash earlier this month.
More bad news could be on the way. A Bloomberg report suggests the Federal Reserve could see a million jobs vanish in a potentially unprecedented downward revision. To this point, the Fed has viewed strong employment data as supporting its 2% inflation target.
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The report notes that Goldman Sachs and Wells Fargo economists predict payroll growth revisions through March, where 600,000 is weaker than estimated. That would equate to 50,000 less jobs a month. Additionally, the former expects a decline as large as a million.
That would indicate that the US labor market has been cooling for some time. Specifically, it would have been slowing down for far longer than the Fed had thought. They are also bound to affect Fed chair Jerome Powell’s highly-anticipated speech to be given at the end of this week. That should give a greater look into their plans for the coming month.