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Job Openings Fall

Overview: Weaker than forecasted economic data was favorable for mortgage markets over the past week. In particular, the reports on the labor market and consumer confidence unexpectedly posted sharp declines. As a result, rates moved lower, dropping from the highest levels in decades.


The Job Openings and Labor Turnover Survey (JOLTS) report suggested that the tightness in the labor market is easing more quickly than anticipated. At the end of July, there were 8.8 million job openings, far below the consensus forecast of 9.5 million and the lowest level since March 2021. There were 1.5 job openings for every unemployed worker, up from typical readings around 1.2 before the pandemic, but far below the recent peak of 1.9. Fewer openings reflect a weaker labor market, as companies have less difficulty hiring enough workers with the necessary skills.

As inflation remains a top concern, the monthly report on consumer confidence published by the Conference Board has been receiving more attention lately, since it may provide hints about upcoming changes in spending habits. The latest reading released this week revealed a much larger than expected decline. Consumers continued to remain cautious about making major purchases due to concerns about rising prices in general, with gas and groceries topping the list of specific items.

In his highly anticipated speech from Jackson Hole on Friday, Federal Reserve Chair Jerome Powell seemed determined to avoid causing much reaction in financial markets. He revealed no significant new information to guide investors on future monetary policy. A big question is whether there will be another increase in the federal funds rate later this year, but he continued to emphasize that decisions will be based on incoming economic data. According to Powell, inflation still "remains too high" and officials are prepared to raise rates further "if appropriate" until they are confident that inflation is moving down toward their target level. He also stressed that officials would proceed carefully in evaluating changing economic conditions to bring down inflation without causing the economy to slow more than necessary.


Job Openings (millions)

Week Ahead

August 31

Personal Income and Outlays

Personal Consumption Expenditures (PCE) Price Index

September 1 — Employment Report

September 6 — Institute for Supply Management (ISM) Services Index


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