The jobs report is definitely strong and suggests the labor market has stabilized or is expanding. Companies that held off hiring due to tariffs/war may now be adding. Gains in local government (schools ending) and leisure/hospitality suggest seasonal effects. We can't say we're out of the woods yet.

There is no month-to-month data showing native-born Americans are rushing into jobs previously held by immigrants. The data is a total count, not a flow. The labor force has fallen significantly; this was the first growth in six months, only 83k.

The political side is important: average hourly earnings fell to 3.4% year-over-year (4-year low), while CPI/PCE run over 4%. This means people's incomes are not keeping up with inflation, creating a political issue for the administration this fall.

Fed funds futures are volatile and don't predict well until days before a meeting. Kevin Warsh enters a difficult situation: all data points away from rate cuts. A strong job market suggests no need for lower rates. If inflation broadens beyond energy, it would call for a rate increase. Beth Hammack (Cleveland Fed) said if inflation doesn't come down, the Fed will have to act soon.