Labor market nearing pre-pandemic conditions, Fed report says
Huntington Private Bank chief economist Olu Omodunbi says the jobs report shows a slowing in the labor market on The Claman Countdown.
The Federal Reserve said Friday in a report to Congress that the U.S. labor market is back in the «tight but not overheated» situation it was in before the COVID pandemic threw the economy into disarray.
The report noted that the job market «continued to rebalance over the first half of this year,» and added: «Labor demand has eased, as many job openings have declined in many sectors of the economy, and labor supply has continued to increase, supported by a strong pace of immigration.»
«The balance between labor demand and supply appears similar to that in the period immediately before the pandemic, when the labor market was relatively tight but not overheated. Nominal wage growth continued to slow,» the Fed's report said.
The semi-annual report comes ahead of two days of testimony by Fed Chair Jerome Powell, who is set to testify before Congress on Tuesday and Wednesday. Lawmakers are expected to press Powell on how the Fed will handle monetary policy heading into the election, with inflation showing signs of gradually easing and the labor market trending toward pre-pandemic levels of demand.
FED'S POWELL: PRICES ARE 'BACK ON DISINFLATIONARY PATH,' BUT MORE CONFIDENCE IS NEEDED
Federal Reserve Chair Jerome Powell and Fed policymakers have signaled that there may be an interest rate cut later this year if inflation data continues to improve. (Kevin Dietsch / Getty Images)
Job growth has slowed in recent months and the unemployment rate has risen steadily from 3.5% last July to 4.1% as of June – up slightly from 4% a month ago and a level the Fed's report indicated was «still at a
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