By: Scott J. Brown, PH.D., Raymond James
Jobs! – As the pandemic recedes and the economy reopens, we can expect strong job growth in the months ahead. The March figures were a start. We may soon see monthly gains in nonfarm payrolls of a million or more. However, as employment rebounds, labor market frictions are more likely to come into play, reflecting the scarring that has occurred over the last several months. It is unclear how much of this will lead to higher wage and price inflation, but pressures ought to be transitory.
This Week – The economic data calendar is lighter. We could see some market reaction to the ISM Services Index (Monday). The report on producer prices (Friday) should continue to show inflation pressures at the earlier stages of production. For those interested in the global economic outlook, the IMF will revised its World Economic Outlook on Tuesday and Fed Chair Powell will speak on the topic on Thursday. FOMC minutes (Wednesday) aren’t likely to add much to the monetary policy outlook, but you never know (the financial press often pulls quotes out of context).