Fed Labor Market Conditions Index Continues Soft

If the Fed relied exclusively on its labor market conditions index, no one would be in much hurry for the rate hike. The index for July came in slightly below expectations at 1.1 vs a revised 1.4 in June. The index, based on a broad set of 19 components, has been hovering near zero all year, well off its 5.4 average of last year. Unemployment may be down but hiring has been soft and the 2015 trend for this index is the weakest of the recovery.

Recent History Of This Indicator:
The labor conditions index is expected to rise but only very slightly, to 1.3 in the June reading vs May's 0.8. This index has been barely over zero and has underscored the still soft rates of employment growth. If based on this index alone, the Fed wouldn't be in any hurry for liftoff.