Stagflation Looms: U.S. Labor Market Falters Amid Inflation and Trade Policies

U.S. employment growth fell short of expectations in July, with nonfarm payrolls revised down by 258,000 jobs over the prior two months. Rising inflation and trade policies have raised concerns of stagflation, influencing potential Federal Reserve interest rate cuts. The job market saw slow growth across various industries.


Devdiscourse News Desk | Updated: 02-08-2025 01:12 IST | Created: 02-08-2025 01:12 IST
Stagflation Looms: U.S. Labor Market Falters Amid Inflation and Trade Policies
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In July, the U.S. employment growth lagged behind predictions as nonfarm payrolls were revised down by a striking 258,000 jobs for the previous two months, signaling trouble in labor market conditions.

The unemployment rate increased to 4.2%, amid declining household employment, prompting speculation of another Federal Reserve interest rate cut in September.

Higher import duties are pushing inflation, raising the specter of stagflation and placing pressure on the U.S. central bank's monetary policy. Employment growth fluctuated across sectors, impacted by trade and immigration policies.

(With inputs from agencies.)

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