According to a report released by the Bureau of Labor Statistics today, the Job Openings and Labor Turnover Survey (JOLTs) revealed a fall in job openings to 7.67 million from June’s downwardly revised print of 7.91 million. This marked a fresh low for the JOLTs number since topping out at 12.2 million in March 2022, observing its lowest level since January 2021. July’s print was also substantially lower than the market’s median estimate of 8.10 million and south of the minimum estimate range low of 7.8 million (Reuters poll).

The report – the first in a series of tier-1 jobs reports this week, which ends with the widely anticipated US Employment Situation Report on Friday – was ultimately a mixed bag.

Hiring rose to 5.52 million (from 5.25 million in June), and the quits rate, which represents ‘voluntary separations initiated by the employee’, was also slightly higher at 3.28 million, up from June’s downwardly revised reading of 3.21 million (the lowest level since September 2020). This highlights that although fewer working positions were available in July, hiring increased moderately, and workers were more willing/confident to leave their jobs. Despite this, it is worth noting that the trend in the quits rate has been to the downside since reaching highs of 4.51 million in April 2022.

50 Basis Point Rate Cut?

In his speech at Jackson Hole last month, you may recall US Federal Reserve (Fed) Chairman Jerome Powell communicating that the central bank does ‘not seek or welcome further cooling in labour market conditions’, as the Fed gears up to begin reducing the Fed funds target rate this month (remained at 5.25%-5.50% for nearly a year). In terms of Fed rate pricing, the latest report has slightly swung the pendulum in favour of a bulkier rate cut this month. As of writing, -110 basis points of easing is now priced in for the year, with -37 basis points of cuts forecasted for September’s meeting.

Dollar Downside

The US dollar (USD) observed a noticeable dip versus a basket of six major currencies lower following the release, clocking lows of 101.31 before slightly pulling back to a lower high of 101.47 on the US Dollar Index. Note that price also recently tested resistance on the daily timeframe at 101.78, possibly opening the door to further downside towards daily support coming in at 100.60.

In other markets, US Treasury yields are on the back foot, and US equity indices are moderately higher on the session.

Daily Chart of US Dollar Index:

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