While we believe payrolls and average hourly earnings are both likely to miss consensus estimates, we think the employment report may be somewhat less important than usual
for the monetary policy outlook, because 1) recent data have been firm so we have some room
for a miss, 2) the August
seasonal issue is now well known so even a somewhat larger miss may not significantly alter the staff view, and 3) there are several months between now and December to make up
for any
weakness in tomorrow's report.
Seeking to further explain the
weakness, a number of economists emphasized the recurring pattern evident in quarterly GDP numbers since 2010 — whereby first - quarter growth has averaged less than half the rate
for the rest of the year — raising suspicions that
seasonal effects may be skewing the data.