Bonds & Bullion Jump, Dollar Dumps As Rate-Hike Odds Slump After Payrolls Miss
As we noted in our preview, today's payrolls print was indeed "bad news is good news" as the surprise five-sigma miss (-23k) on payrolls (albeit with a drop in the unemployment rate) sent rate-hike odds reeling lower...
“History doesn’t repeat, but sometimes it rhymes. For the third time in as many years, July jobs data saw a mid-summer loss of momentum. While incoming inflation data will be the ultimate arbiter, slowing jobs growth helps support a September hold,” says Lindsay Rosner, head of multi sector fixed income investing at Goldman Sachs Asset Management.
That helped smash Treasury yields lower, led by the short-end...
...which in turn crushed the dollar...
...lifting gold above $4350...
Some good news for Bessent, JPY is strengthening...
Stocks are also soaring, with Nasdaq leading the way...
Admittedly, as JPMorgan's Feroli flagged, technical effects such unwinding of World Cup-related hiring could have driven the softer payroll print...
Jeffrey Rosenberg, a portfolio manager at BlackRock, says on Bloomberg TV, “I’d be hesitant to just write this report off.”
He says that the decline in the unemployment rate essentially reflects a drop in the supply side of the labor market.
... but for now, the panic among the Fed whisperers that Warsh has unleashed more uncertainty (and is driving up the term premium) is now a back story as attention shifts from inflation back to growth.
Related Markets
All MarketsMarket data may be delayed. Not financial advice.
- • Payrolls missed expectations by 23,000, causing Treasury yields and the dollar to drop.
- • Gold prices surged above $4,100 as investors anticipated the Fed will hold interest rates steady.
- • Stock markets rallied, particularly the Nasdaq, on the news of slowing economic growth.
The market is reacting to weak labor data by betting that the Federal Reserve will pause rate hikes. This shift moves investor focus from fighting inflation to supporting economic growth.
Christian Perspective
The volatility in fiat currency and the surge in gold reflect a growing distrust in man-made economic systems. True stability is found in God's providence rather than the fluctuating whims of central bankers. We must recognize that economic chaos often precedes social upheaval.
Implications
A weakening dollar threatens the purchasing power of the American family and the ability of men to provide for their households. Economic instability undermines the traditional patriarchal structure by creating uncertainty in the domestic sphere. Financial volatility serves as a distraction from the spiritual health of the nation.
Broader Trends
The reliance on central bank manipulation signals the continued decay of liberal economic models. This instability is often exploited by globalist interests to further erode national sovereignty. Economic shifts like these often mask deeper demographic and cultural transformations occurring within the country.
Takeaway
Prioritize tangible assets like gold and Bitcoin to protect your family's wealth from fiat devaluation. Focus on building self-sufficient, large households that can withstand economic volatility. Maintain an America First mindset by favoring local stability over globalist financial trends.
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