The U.S. economy added only 73,000 jobs in July while the numbers for May and June were revised down sharply by a total of 258,000, according to data the Labor Department released Friday.
After revisions, job gains in June were the weakest since December 2020, during the Covid pandemic. The unemployment rate remains low but rose slightly, from 4.1 to 4.2 percent.
Many economists blame President Donald Trump’s trade policy for the worse-than-expected numbers. Trump has threatened high tariffs against major U.S. trading partners and has alternated between imposing new levies and pausing them, creating uncertainty for businesses.
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In some cases, the president has used the threat of tariffs to compel foreign governments to align with the U.S. on geopolitics. After the Canadian Prime Minister Mark Carney announced Wednesday that Canada will recognize the state of Palestine, Trump said the move “will make it very hard” for Washington and Ottawa to reach a trade agreement.
The stock market also dipped as the president raised tariffs on most trading partners Friday. Traders now expect the Federal Reserve to cut interest rates to boost the economy, according to the CME FedWatch Tool. On Thursday they gave a rate cut a 38 percent chance, but on Friday that number jumped to 67 percent.
The Trump administration has pushed the Fed to cut rates, but Jerome Powell, the chair of the Federal Reserve, has resisted for fear of inflation. On social media, Trump ramped up pressure on Powell Friday, calling him a “stubborn MORON” and saying “THE BOARD SHOULD ASSUME CONTROL.”
