SUNDAY LOOK AHEAD
The chair blamed the hiring slowdown on a shrinking labor force rather than weak demand. Payrolls land Friday, with ISM, JOLTS and ADP ahead of them. Broadcom reports Thursday. September hike odds sit at 60 percent.
Last week Warsh said the economy has strengthened and financial conditions don’t look restrictive.
He acknowledged hiring has slowed, then attributed it to a flattening labor supply rather than falling demand for workers.
That single claim is the load-bearing wall under a September hike. If hiring is slow because fewer people want jobs, the Fed can tighten without breaking anything. If it’s slow because employers stopped hiring, tightening into it is a different decision.
Four labor prints land this week. By Friday, Warsh’s explanation looks either much stronger or much harder to defend.
Friday moved the front end and left the long end alone.
The 2 year Treasury yield ran from 4.22 to 4.31 percent. The 30 year fell to 5.181. September hike odds jumped to roughly 60 percent from 35. Odds of two or more hikes by year end went to 50 from 29.
Stocks barely moved. The entire reaction happened inside the curve.
The earnings tape changed too. Nvidia (NVDA) beat and had its biggest session in more than a year. Then Marvell Technology (MRVL) raised two years of guidance Thursday night and fell hard. Ulta Beauty (ULTA), Autodesk (ADSK) and Workday (WDAY) all beat or raised and sold off. The market stopped paying for beats it already owned.
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The company is about one fiftieth the size of Newmont.
A THIN OPEN
The Dallas Fed manufacturing index lands at 10:30. Regional surveys have run hot on activity and cold on pricing power all month. The Philadelphia Fed printed its best headline since 2021 two weeks ago, while barely one factory in five raised prices.
Watch Signal
Read prices paid and prices received before the headline. The gap between them has been the real story in every regional survey this month, the same gap that showed up in Nvidia’s and Marvell’s margin guides.
THE FIRST TWO LABOR READS
ISM Manufacturing prints at 10:00 with its employment subindex. JOLTS job openings land the same hour.
JOLTS is the direct test of Warsh’s claim. It measures demand for workers, not supply. Openings have drifted lower all year. Another drop and the slowdown looks increasingly like a demand problem, and the supply explanation gets harder to defend.
ISM manufacturing employment has sat in contraction for most of the year. Factories aren’t the swing factor in payrolls, but the subindex leads.
Fed Vice Chair for Supervision Michael Barr speaks.
Watch Signal
Pull openings per unemployed worker. It’s the cleanest single measure of whether employers still want people. Below one would matter: fewer openings than unemployed workers, a very different labor market from the shortage conditions of recent years.
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ADP AND THE MORTGAGE RATE
ADP employment change lands at 8:15. It’s an imperfect proxy for payrolls, but the only private read before Friday.
The MBA 30 year mortgage rate prints earlier. Warsh moved the front end Friday but barely moved the long end, leaving the housing rate problem intact.
Watch Signal
ADP has run soft against payrolls for months. A weak print alone won’t move the September debate. A weak ADP followed by a weak payroll count Friday would.
SERVICES, TRADE, AND BROADCOM
ISM Services prints at 10:00. Services employment matters far more than manufacturing for the payroll count. Initial jobless claims land at 8:30, alongside the full trade balance.
That trade number deserves attention. The advance goods deficit hit $118.8 billion in July, its widest since March 2025, driven by an 11 percent jump in capital goods imports. Semiconductors and computing equipment did it. Barclays cut its Q3 GDP estimate to 1.8 percent from 2.2 on that print. Thursday’s full report adds services and confirms or revises the goods number.
Broadcom (AVGO) reports after the close. It’s the most important earnings event of the week, and it lands directly on the theme Marvell just failed. Broadcom sells custom AI silicon to hyperscalers, the same business that dragged Marvell’s blended margin down.
Hewlett Packard Enterprise (HPE) and Dell (DELL) report the same window. Both assemble AI servers and both buy the memory that Nvidia said had run past expectations.
Broadcom tests Marvell’s custom silicon problem. Dell and HPE test Nvidia’s memory cost problem. Same margin question, two different points in the chain.
Christopher Waller and Beth Hammack both speak. Hammack said last week that now is the time to act.
Earnings Signal
All three sit between Nvidia and the customer. If their margins compress too, the memory shortage is eating the whole chain, not one line on one income statement.
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PAYROLLS
Non-farm payrolls, the unemployment rate, average hourly earnings and the participation rate all land at 8:30.
July payrolls came in negative. May and June were revised down by 103,000 combined. The unemployment rate fell to 4.1 percent only because participation dropped to a five year low.
That participation line is exactly what Warsh pointed at. Fewer people looking means a lower unemployment rate without more hiring. He reads that as a supply constraint. But falling participation alone can’t say why people left, which is why Friday’s wage and hiring numbers matter alongside it.
Friday gives four numbers that work together. Payroll growth says how many jobs were added. Participation says how many people are looking. Earnings say whether employers are still competing for workers. The unemployment rate says what the first three add up to.
Watch Signal
Watch wages and openings against payroll growth. Weak hiring with firm wages and abundant openings supports Warsh’s supply argument: employers still want workers and can’t find them. Weak hiring with falling openings and softer wages says demand is deteriorating too. That combination makes a September hike much harder to justify twelve days before the meeting.
Canada’s retaliatory tariffs take effect September 8.
They cover roughly $20 billion of goods, more than 700 items, at rates from 15 to 50 percent. Steel, aluminum, dairy and seafood. Anyone shipping north has one more week to move product.
Sector Read
Broadcom Thursday and payrolls Friday are the week. One tests whether AI margins hold outside Nvidia. The other tests whether Warsh’s read on the labor market survives contact with the data.
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Warsh gave the market a framework Friday, not a forecast. He said the economy has strengthened, that credit and loan markets show few signs of restraint, and that this summer’s better inflation prints don’t convince him the trend has improved.
Every piece of that rests on a labor market that is slowing for the right reasons.
This week hands him four chances to be wrong. JOLTS Tuesday. ADP Wednesday. ISM Services Thursday. Payrolls Friday.
Warsh told the market he won’t say what comes next. He did tell it why he thinks there is room to tighten.
This week tests whether that reason survives the data.
Twelve days before the meeting, the labor market gets to answer.
We’ll be in your inbox Monday morning with the map.