MNI BRIEF: Fed Hammack: Jobs Bear Watching, Inflation To Rise

"Disappointing signs" in the July jobs report bear careful watching, but the U.S. labor market remains largely in balance, Federal Reserve Bank of Cleveland President Beth Hammack said Friday after Bureau of Labor Statistics data showed a sharp slowdown in hiring over the past few months.  

"It looks like a healthy labor market that's still well in balance, but with some disappointing signs that we should watch very carefully," she told Bloomberg Television. Asked about a possible rate cut in September, she noted there are more data to come and, "I walk into every meeting with an open mind."

"We're seeing pressure on the inflation side of the mandate. That's where our miss has been bigger, and it's been lasting for longer," she said. "I do expect that we're going to see inflation continue to tick up into the end of this year and I expect that we'll see the labor market weaken into the end of this year and how we need to manage that really depends on by how much and for how long we're going to miss on each side." (See: MNI INTERVIEW: Inflation Could Stifle 2025 Fed Cuts-George)