Strong jobs numbers diminish urgency for rate cuts
|Summary
United States: Strong jobs numbers diminish urgency for rate cuts
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Nonfarm payrolls expanded 303K in March, surpassing all estimates submitted to Bloomberg. The continued strength in hiring suggests less urgency for policymakers at the Federal Reserve to lower the target range of the fed funds rate. Recent comments from FOMC members have homed in on the jobs market's underlying momentum as justification to wait and allow for more inflation data.
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Next week: Small Business Optimism (Tue.), Consumer Price Index (Wed.)
International: Springtime sentiment data in Asian economies show buds of optimism
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This week saw the release of important economic sentiment data from both G10 and emerging economies. In Japan, the Bank of Japan's Q1 Tankan survey—a closely watched measure of business sentiment—showed signs that Japan’s economy may be able to gradually recover this year. In China, official March PMIs for the manufacturing and non-manufacturing sectors surprised to the upside, suggesting the economy started 2024 on a fairly solid note.
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Next week: Mexico CPI (Tue.), Bank of Canada Policy Rate (Wed.), European Central Bank Policy Rate (Thu.)
Credit market insights: Nothing but net: Household net worth climbed in the fourth quarter
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Household net worth climbed in the fourth quarter across all wealth cohorts. When indexed to 2000, household net worth is now at a fresh all-time high, sitting above its initial post-COVID peak from Q1-22. The biggest driver of the increase was a rise in corporate equities and mutual fund shares.
Topic of the week: FY 2024 budget complete, but fiscal fights still loom
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On March 23, President Biden signed into law the last remaining appropriations bill for fiscal year 2024, completing a budget process that dragged on for nearly a year and included four short-term continuing resolutions to keep the government open and operating. That said, federal fiscal fights are anything but over.
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