Report to show if jobs number was just a fluke

- Paul Davidson @Pdavidsonu­sat USA TODAY

Economic news this week features a pivotal jobs report that could reveal where the labor market is headed after two dismal monthly showings. Also on tap are minutes of the Federal Reserve’s June 14-15 meeting, at which policymake­rs forecast a markedly slower climb in interest rates. The minutes could shed more light on the reasons.

No one expected the Fed to lift its benchmark rate last month after the latest payroll report revealed the economy added just 38,000 jobs in May and 123,000 in April. What’s more, the United Kingdom’s Brexit vote loomed a week later, packing a potential wallop for markets. What surprised many economists was the Fed’s dour outlook. Although policymake­rs’ median forecast still called for two rate hikes this year, six officials predicted just one. Fed Chair Janet Yellen cited persistent headwinds to growth, such as weak productivi­ty gains. The minutes, slated for release

Wednesday, should show how widely her concerns are shared by her colleagues. The account is also likely to clarify the role the Brexit vote played.

A report on the service sector — 80% of the economy — also will be closely watched. In May, the Institute for Supply Management’s non-manufactur­ing index continued to show expansion but at a noticeably slower rate.

Friday brings an eagerly awaited job report. The recent dramatic slowdown in payroll gains was traced to myriad factors. All told, economists expect the Labor Department to report a modest recovery, with 180,000 jobs added in June.

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