The White House is pleased with a strong jobs report.
The White House celebrated a stronger-than-expected jobs report on Friday, stressing that the surge in hiring shows the U.S. economy remains strong even as the war with Iran continues to drive up oil and gas prices.
The report, which showed employers added 172,000 jobs in May, was also a political victory for President Trump, who has struggled for months to contain voters’ growing economic fears. It gives him something new to talk about as he struggles to win support for his faltering agenda months before voters go to the polls in the midterm elections.
However, the strong hiring, which far exceeded analyst expectations, came with an important caveat. Growth in the labor market – in addition to recently uncomfortably high inflation – appeared to reduce the likelihood that the Federal Reserve would cut interest rates any time soon.
Mr. Trump has repeatedly called for these drastic cuts. Weeks ago, he celebrated the swearing-in of his new central bank chairman, Kevin M. Warsh, with the hope that he could get there soon. And yet current economic trends made it less likely than ever that the Fed would cut interest rates. Markets now believe the next step will be a rate hike, possibly in 2027.
“This is about the strongest market of my lifetime,” Kevin Hassett, director of the White House National Economic Council, said of the labor gains during an appearance Friday on CNBC.
Mr. Hassett attributed the “tremendous positive momentum in hiring” to the president’s policies, including the tax cuts he passed last year. That should boost growth, he said, but not in a way that would force the Fed to raise interest rates.
“It’s a supply-led labor market boom, which I think means the Fed can keep an eye on the inflation numbers and wait a while before doing anything about it,” he said.
Since the war began, Mr. Trump and his top aides have tried to downplay the economic fallout. The president has dismissed the consequences or described them as temporary, and in some cases he has indicated that he expected them to be far worse – causing the stock market to plunge while driving oil and gas prices sharply higher.
According to AAA, the price of a gallon of gasoline reached $4.22 nationwide on Friday, down from its wartime peak but still a significant increase from the previous year. That has put additional strain on American families, as most of them increasingly tell pollsters that they are frustrated with the country’s economic performance. Also among the strains is that workers’ incomes have not kept pace with price increases, a gap that has hit lower-income families the hardest.
“President Trump’s failed economic agenda is causing families’ paychecks to shrink,” Sen. Elizabeth Warren, Democrat of Massachusetts, said in a statement Friday. “Instead of repairing the economic damage he has caused, Trump is escalating his reckless tariffs and war in Iran.”
But despite these numbers, Mr. Trump remains optimistic. Speaking to reporters on Thursday, he reiterated his belief that the affordability debate is a “fraud” while boasting that the stock market is setting records under his watch.
“There is clear momentum in the American economy due to President Trump’s proven economic agenda of tax cuts, deregulation and energy abundance that is unleashing the private sector,” Kush Desai, a White House spokesman, wrote on social media.
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