- The Federal Reserve kept the federal funds rate target range at 5.25% to 5.50%
- The unemployment rate rose to 4.3% in July
- Home prices rose 6.8% in May versus the prior year
Top Three Market Headlines
Federal Reserve Holds Policy Rate Steady: The Federal Reserve's rate-setting committee voted last week to maintain the central bank's interest rate policy benchmark, the federal funds rate, at its current level of 5.25% to 5.50%. The target range has been fixed at this level since July 2023. Amid speculation about when the Fed may revise its stance, Chairman Jerome Powell said policymakers believe the economy is "moving closer to the point at which it will be appropriate to reduce our policy rate," and acknowledged that a cut could be on the table at the next meeting in September depending on data that is released between now and then.
July Jobs Report Disappoints: The U.S. Department of Labor reported last week that the U.S. economy added 114,000 jobs in July, well below economists' expectation for 175,000 gains. Additionally, the June report saw a downward revision to 179,000 new jobs from an initial estimate of 206,000. After averaging nearly 270,000 over the first quarter of 2024, monthly gains have slowed to an average of 154,000 over the last four months. Meanwhile, the unemployment rate crept higher again in July, hitting 4.3%, up from 4.1% in June and 3.5% in July of last year.
Upward Trend in Home Prices Decelerates in May: Home prices rose again across the U.S. in May, with the S&P Case-Shiller Home Price Index 20-city composite increasing 0.3% on the month and 6.8% versus the prior year. This was the 11th straight month of year-over-year price increases, though the pace has slowed somewhat after hitting 7.5% in March. New York posted the highest annual gain in May at 9.4%, followed by San Diego and Las Vegas with increases of 9.1% and 8.6%, respectively. Overall, all 20 markets saw annual gains for the last six months.