Another Week of Mixed Reports
A welcomed surprise was the nonfarm payrolls report, which came in well above consensus estimates registering an increase of 163,000 jobs in July. Household employment, however, dropped by 195,000 jobs and the unemployment rate edged a notch higher to 8.3 percent.
One disappointing release was the ISM manufacturing report, which remained in negative territory for the second consecutive month. While disconcerting, it does not portend a recession and is consistent with our real GDP forecast of around 1.0 percent in the second half of the year.