US nonfarm payrolls unexpectedly declined in July, down 23,000, with June’s gain
revised down to a 20,000 increase, raising questions about a September Fed rate
hike. The unemployment rate eased to 4.1% from 4.2% as labor force participation
fell; economists describe the market as “slow hiring, slow firing.” Despite six
months of Middle East tensions, Q2 domestic demand grew at the fastest pace in
three years. Markets had priced a September hike before the report; next week’s
inflation data may intensify debate over near-term monetary policy.
