2 February 2024 US Monitor Government hiring likely juiced January jobs, but alarm bells for Q2

• We think total payrolls rose by about 225K in January, comprising 175K private and 50K government.
• Similar gains are likely through the end of Q1, but we expect a meaningful slowing in job gains in Q2.
• Don’t worry about the jump in ISM prices paid; it’s an unreliable guide to CPI core goods prices.

Ian Shepherdson (Chief Economist, Chairman and Founder)US

PM Datanote: Chicago PMI

Manufacturing still in the doldrums

Ian Shepherdson (Chief Economist, Chairman and Founder)US

PM Datanote: Q4 Employment Costs/January ADP

Low ECI print makes a March easing more likely

Ian Shepherdson (Chief Economist, Chairman and Founder)US

1 February 2024 US Monitor Cautious Fed holding to May, pending confirmation of the inflation story

• The Fed wants to see confirmation of its base-case forecast that inflation is headed to target…
• …If the data before March are favorable, the first ratecut will come at that meeting, but no guarantees.
• The ISM manufacturing survey likely will show that the industrial economy is still in a hole.

Ian Shepherdson (Chief Economist, Chairman and Founder)US

PM Datanote: Consumer Confidence/JOLTS

Consumers show little sign of tiring

Ian Shepherdson (Chief Economist, Chairman and Founder)US