July 2, 2024
United States:
US Labor Market Shows Signs of Losing Steam, Putting the Fed on Alert
Economists and some Federal Reserve officials are increasingly on alert that pain could be on the horizon for American workers amid signs the labor market is losing steam.
Companies are posting fewer job openings this year and employees are quitting less as unemployment has begun creeping up from low levels, signaling the end of the historically-tight labor conditions that characterized the rapid recovery from the pandemic shock.
Europe:
ECB’s Lane Says Data Needed Beyond June to Clarify Services Path
Inflation data for last month won’t provide answers to the European Central Bank’s lingering questions on underlying price pressures, according to Chief Economist Philip Lane.
Speaking to Bloomberg TV, he joined President Christine Lagarde in signaling that another cut in interest rates in July is unlikely, calling for patience in collecting evidence that the ECB is heading toward its 2% target.
Asia:
Japan’s Economy Now Seen Shrinking in 2024 by Two Forecasters
Two economists flipped their forecasts for Japan’s economy to show a contraction in 2024 a day after first-quarter gross domestic product data were revised sharply lower, highlighting the Bank of Japan’s quandary as it weighs the case for a rate hike.
Economists at BNP Paribas and SMBC Nikko Securities slashed their growth projections to predict 2024 will mark Japan’s first annual contraction since the pandemic in 2020, according to reports Tuesday. BNP’s Ryutaro Kono predicts GDP will shrink by 0.4% while SMBC economists led by Yoshimasa Maruyama said the retreat will be by 0.3%. Both previously predicted slight expansions.
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