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Why Wall Street got the jobs number so wrong
You may have noticed yesterday that there was a bunch of chatter prior to the U.S. Bureau of Labor Statistics’ latest report that the number of new jobs created might be lower than the 110,000 consensus estimate. Analysts at Goldman Sachs, UBS, and Pantheon Macroeconomics all said they thought the number might be weaker than predicted. The ADP private payroll report, published before the official government number, showed a 33,000 decline in jobs.
In the event, the number of nonfarm payroll jobs increased by 147,000 in June, the bureau said—way above expectations.
So why did so many people get this wrong?
The fact that President Trump was tweeting angrily about U.S. Federal Reserve Chair Jerome Powell the night before distracted many, who read into those social media posts that perhaps he had seen a preview of the jobs report, didn’t like it, and was—as usual—trying to set up Powell as the fall guy.
That turned out to be a false signal.
In the event, the number of nonfarm payroll jobs increased by 147,000 in June, the bureau said—way above expectations.
So why did so many people get this wrong?
The fact that President Trump was tweeting angrily about U.S. Federal Reserve Chair Jerome Powell the night before distracted many, who read into those social media posts that perhaps he had seen a preview of the jobs report, didn’t like it, and was—as usual—trying to set up Powell as the fall guy.
That turned out to be a false signal.
https://www.yahoo.com/finance/news/why-wall-street-got-jobs-103733618.html
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