Economist Carl Riccadonna called today’s jobs number perfectly. Yesterday I read his preliminary analysis where he pointed out August’s strong tendency to miss consensus expectations. He also pointed out the tendency for the number to be revised upward in subsequent months.
In his update today, he essentially acknowledged the above, but also points out that Hurricane Harvey will no doubt do a number on employment data for awhile going forward. We agree. In fact, we expect that the incredible run of sub-300k weekly jobless claims will come to an end solely as a result of Harvey’s impact on the folks directly affected. Of course that will be a blip in a key data point that we’ll have to discount due to the unique circumstances causing it.
In terms of the Fed, our economic assessment (as we’ve illustrated) suggests that policy will indeed be a bit less accommodative going forward, as Riccadonna points out below:
DAILY BRIEF: ECONOMICS