It took only a few days for the Federal Reserve’s latest decision on interest rates to age like milk.
The central bank on Wednesday said it was holding borrowing costs steady yet again, extending a wait-and-see pattern that began in January. That same day, Fed Chair Jerome Powell told reporters that a “solid” labor market means central bankers still have the luxury of waiting to see how President Donald Trump’s tariffs affect prices before resuming rate cuts that could help boost jobs but could also reignite inflation.
Just two days later, it turned out that the job market is on shakier ground than Powell had suggested. It may take a bit more time to know if that’s really the case.
But the Fed may walk away with egg on its face.
On Friday, the Labor Department reported that employers added just 73,000 jobs in July, well below the threshold of monthly job growth necessary to keep up with population growth. Meanwhile, the unemployment rate ticked up to 4.2% from 4.1%.
