Fed watcher Nick Timiraos: Slower job growth could be the new baseline as geopolitical risks mount

Huoxing Finance reported that Nick Timiraos, often dubbed the Fed's "spokesperson," said on April 4 that the U.S. added 178,000 jobs in March, rebounding from February's steep slowdown. The unemployment rate edged down to 4.3%. The report's details were more mixed. Pay gains for typical workers cooled, posting the weakest year-over-year increase since the five-year, post-pandemic recovery began. Smoothing out two unusually volatile months, the underlying pace looks far softer: average monthly job growth was about 22,500. Timiraos noted that a figure like that would have triggered concern two years ago; now it may still be viewed as acceptable, even as Fed officials struggle to explain the shift. San Francisco Fed President Mary Daly wrote Friday: "It is not easy to get the public to understand that an economy with zero job growth can still be consistent with full employment." He also warned the backdrop is becoming more fragile amid fresh supply shocks. If the Iran conflict drags on and elevated fuel costs or commodity shortages squeeze businesses and households, the labor market may have little cushion to absorb the hit. At the same time, persistent inflation worries could weaken confidence in rate cuts, narrowing the Fed's room to maneuver.