6/06/23 Market Snapshot: Kicking the Debt Ceiling Can, Higher unemployment rate

An agreement on the U.S. debt ceiling was approved this week by both the House and Senate
ending weeks of negotiation. The deal suspends the debt ceiling limit until January of 2025 and sets a cap on non-defense spending in 2024. The May job market data had a bigger impact on the markets than the agreement in Washington as Friday’s Non-Farm Payroll report surprised to the upside with an increase of 339,000 jobs versus expectations of 190,000. Key items in the report reflected a higher unemployment rate at 3.7% and a decline in hourly earnings. This combination of job growth with decreasing wage pressure is in line with the Federal Reserve’s goal of reducing inflation.