Based on Cleveland Fed nowcasts:
Figure 1: CPI (black, left log scale), Cleveland Fed nowcast (light blue, left log scale); quarter-on-quarter annualized inflation (red, right scale), Cleveland Fed nowcast implied inflation (light red, right scale). Source: BLS, Cleveland Fed, and author’s calculations.
http://www.cnbc.com/2026/09/02/private-payrolls-rose-by-38000-in-august-fewer-than-expected-adp-reports.html
Private companies added 38,000 jobs in August, down from 46,000 and below the estimate for 47,000, for the slowest month since January, according to ADP.
Three categories accounted for most of the job growth: education and health services, leisure and hospitality and construction. Manufacturing saw a loss of 17,000 jobs.
Paging Kevin Hassett, EJ Antoni, and Bruce Hall. You have to spin this in a positive direction just in time for the Kudlow Klown Show!
In ADP’s Pay Insights report for August, overall wage gains slowed to 3.2% y/y from 3.3% in July. Job-stayers’ gains steady at 3.0%, job-changers’ gains slowed to 4.7% from 4.8%.
Nela Richardson makes the point in today’s employment report that when noisy data obscure the message of hiring numbers, wage data help provide clarity. A year ago, job changers’ wages were up 7.1% vs 4.4% for stayers. Not only have wage gains cooled for both groups, but the gap is narrowing, a clear sign of weakening labor demand.
Taking Dr. Richardson’s point to heart, the labor market is weakening; clearly, wage-push inflation is not a problem. Conversely, recent Fed talk says the labor market is stable, making room for rate hikes; the Taylor rule doesn’t address wages, but does justify a rate hike.
Workers are already suffering for problems not of their making and it looks like it’s going to get worse. That’s how we do it.
Thinking about the felon-in-chief’s various “affordability” initiatives, there’s something odd in the beef market. The price for “live cattle” is down 9% from a month ago, down 11.4% y/y. At the same time, “beef” (slaughtered beef in 15 kilo lots) is flat on the month and up 10.8% y/y.
This is reminiscent of the massive crack spread in the oil market. Sure, oil is up and live cattle are down, but the markup of the product in both markets, slaughtered beef and diesel fuel, is eye-popping. While ranchers are getting 11% less, grocers paying 11% more for beef. The beef and veal CPI sub-index was up just 9.4% y/y in July, so maybe grocers are absorbing some of the price increase. Is there, perhaps, a monopolistic element to beef processing?
https://www.ers.usda.gov/amber-waves/2024/january/concentration-in-u-s-meatpacking-industry-and-how-it-affects-competition-and-cattle-prices