PREVIOUS TRADING DAY EVENTS 30 August 2023

The JOLTS job openings report showed that U.S. job openings dropped to the lowest level in nearly 212 years in July, to 8.83M. Interest rate increases by the Fed have finally shown a desired effect as the labour market gradually slowed. The number of people quitting their jobs dropped to levels last seen in early 2021. 

The survey from the Conference Board showed that consumers perceptions of the labour market cooled in August. Nevertheless, labour market conditions remain tight, with 1.51 job openings for every unemployed person in July, compared to 1.54 in June.

Although the labour market is still tight, the degree of excess demand is declining and is coming about through companies reducing the number of vacancies rather than increasing layoffs and unemployment, said Conrad DeQuadros, senior economic advisor at Brean Capital in New York. There is plenty here to make the case that not only is the labour market rebalancing but at this point it is doing so without pushing up unemployment.

At the Jackson Hole economic conference in Wyoming on Friday, Fed Chair Jerome Powell said that the U.S. central bank will proceed carefully as we decide whether to tighten further or, instead, to hold the policy rate constant and await further data. Financial markets expect that the U.S. central bank will leave its benchmark overnight interest rate unchanged at its policy meeting next month.

With reports like this, the Fed can most…