In a panel discussion overnight, Fed Governor Lisa Cook described July’s weaker-than-expected jobs report as “concerning” and noted that the pattern of downward revisions to payroll figures was “somewhat typical of turning points.”
Cook warned that uncertainty is now acting like a tax on businesses, with executives spending more time managing ambiguity than making forward-looking decisions. “This is deadweight loss,” she said.
Boston Fed President Susan Collins supported that view, stating the uncertainty burden is “top of mind” for firms across sectors. She pointed out that the effects extend beyond capital spending, with many businesses now hesitant to adjust pricing strategies due to a lack of visibility. “There’s still a wait-and-see,” Collins said.
The shared emphasis from two Fed officials underscores how economic ambiguity is increasingly viewed as a constraint on both employment and inflation dynamics. While neither Cook nor Collins offered direct policy guidance, their comments will reinforce expectations that the Fed is growing more open to easing, particularly if labor and business activity remain sluggish into the fall.
