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The majority of economists have decided the Fed’s soft-landing is improbable, but the labor market is cooling right on cue.
The U.S. added 236,000 jobs in March, right at the consensus forecast. The unemployment rate ticked down to 3.5%. This report had some really good news for the macroeconomy: wage growth continues to slow and labor supply is expanding. While job gains are slowing, that’s a good thing. The combo of cooling demand and an influx of workers is depressurizing the labor market. That’s just what the Fed wants to see to justify ending its cycle of rate hikes.
