This month, the U.S. Bureau of Statistics announced an increase of 187,000 in seasonally adjusted non-farm employment in August, higher than the expected 170,000. However, the unemployment rate rose to 3.8%, higher than the expected 3.5%. These data suggest that while the employment market remains strong, there are changes in inflation persistence and labor market conditions.

Furthermore, Federal Reserve Chairman Powell emphasized the Federal Reserve’s responsibility of achieving a 2% inflation target at the Jackson Hole Global Central Bank Annual Meeting. He pointed out that inflation remains high, but economic growth is also above trend, which may be a reason for the Federal Reserve to maintain its current monetary policy. Despite the non-farm data exceeding expectations in August, the rise in the unemployment rate and revisions to previous values indicate potential changes in labor market and inflation conditions, raising market expectations for the Federal Reserve to halt rate hikes. Moreover, in July, the number of U.S. existing home sales reached 4.07 million, a low since January 2023 and below the market expectation of 4.15 million. In contrast, the total number of new home sales in July increased by 12.8% year-on-year, reaching 714,000, marking the highest in over a year. This shows that under declining inflation, U.S. consumer spending remains healthy, and the U.S. economy can achieve a soft landing towards a healthier and more stable state.