Trump Urges Fed To Cut Rates After Jobs Data Tops Forecasts, Says Economy Is ‘In Transition Stage’

U.S. President Donald Trump has called on the Federal Reserve to cut interest rates after the April jobs numbers topped estimates. 

“We’re only in a TRANSITION STAGE, just getting started,” the President said in a post on Truth Social. “NO INFLATION, THE FED SHOULD LOWER ITS RATE!”

The Labor Department reported that nonfarm payrolls rose by 177,000 in April, surpassing the Dow Jones forecast of 133,000 cited by The Wall Street Journal (WSJ). 

While job growth slowed from March’s downwardly revised 185,000, the pace remains well above what economists estimate is needed to keep up with population growth. Bloomberg Economics previously pegged that “breakeven rate” at 105,000.

The unemployment rate held steady at 4.2%, which aligned with expectations. The broader underemployment rate, which includes discouraged workers and those working part-time for economic reasons, declined to 7.8%. 

The household survey, used to calculate the jobless rate, showed an increase of 436,000 employed persons, while labor force participation ticked up to 62.6%.

The report showed strength across several sectors. Health care added 51,000 jobs, followed by transportation and warehousing with 29,000, and financial activities with 14,000.

Government hiring was mixed. While total government employment rose by 10,000, federal payrolls declined by 9,000 in April. 

Since January, federal employment has dropped by 26,000 amid a cost-cutting push led by Elon Musk and the Department of Government Efficiency. The Bureau of Labor Statistics does not count furloughed employees receiving severance as unemployed.

Markets responded positively to the data. Futures linked to the Dow Jones Industrial Average, the S&P 500, and the Nasdaq-100 rose more than 1%, while the small-cap Russell 2000 jumped 1.5%.

The SPDR S&P 500 ETF Trust (SPY), which tracks the S&P 500, and SPDR Dow Jones Industrial Average ETF (DIA), and the Invesco QQQ Trust, Series 1 (QQQ), which tracks the Nasdaq Composite, rose more than 1.2% each. 

However, bond markets dialed back expectations for a Fed rate cut in June. Futures markets now reflect slightly less than a 50% probability of a cut, down from slightly more than 50% before the release.

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Read also: US Jobless Claims Jump to 2-Month High, Continuing Claims Hit Highest Level In Over 3 Years