We believe a weakening labor market will push the FOMC to resume cutting the federal funds rate at its upcoming meeting on Sept. 16-17. Coming into the year, the labor market seemed to have stabilized after a mini swoon that began last year. But the more recent data tell a less optimistic story. The three-month moving average on nonfarm payroll growth has fallen to just 29K. Private sector data generally corroborate the trend in the BLS data (Figure 1). Some of the slowdown can be attributed to much slower growth in labor supply amid significantly less immigration into the United States and an uptick in deportations ... (full story)