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With private employment ramping up in June and jobless claims falling last week by the most in two months, there could be hope yet for the struggling U.S. labor market.
But new data out Thursday paints a bleaker picture, as reports showed lackluster retail sales and the services sector’s inching forward at the lowest level in two and a half years.
As usual, all eyes will be focused on Friday’s non-farm payroll employment report to determine where the market goes next, and the Fast pros are here to tell you how to trade the number.
Michelle Meyer, senior U.S. economist at Bank of America Merrill Lynch, kept her initial estimates intact. She thinks the economy should see 100,000 new jobs added for the month of June and sees the unemployment rate holding steady at 8.2 percent. The break-even level should be somewhere between 100,000 and 125,000, but since expectations for the rest of the year are set so low, “this could be the [strongest] payroll print for the rest of the year,” she said.
And while the Fed gears up to make a move, Meyer thinks a lower unemployment rate plus a mark of 50,000 jobs or fewer could spur on a QE3 . Either way, she said the Fed will most likely wait until its two-day FOMC meeting in September to take any action.
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