‘Every morning in Africa, a gazelle wakes up; it knows it must run faster than the fastest lion or it will be killed.” — Leon Cooperman

1. U.S. Job Openings Dropped in February — the number of job openings fell in February, dropping below 10 million for the first time in nearly two years in a sign that employers’ demand for workers eased amid a still strong labor market. That fits the overall picture of a solid but slightly cooler labor market in February. Employers added 311,000 jobs—fewer than in January but a still robust gain—while the unemployment rate edged higher but remained low at 3.6%.
“We’re finally seeing companies cutting back their openings, which is the first step towards easing the tightness of the labor market,” said Lightcast Senior Economist Ron Hetrick. “This could be what a soft landing looks like in today’s economy.”
2. US Service Gauge Falls More Than Expected as Demand Moderates — The group’s index of new orders at service providers dropped more than 10 points to a three-month low of 52.2. While still consistent with expansion, the scale of the drop suggests a significant slowing in the pace of bookings growth. The business activity measure, which mirrors the ISM’s factory production index, slipped to 55.4. “There has been a pullback in the rate of growth for the services sector, attributed mainly to a cooling off in the new orders growth rate, an employment environment that varies by industry and continued improvements in capacity and logistics,” Anthony Nieves, chair of the ISM Services Business Survey Committee, said in a statement.
3. Fed’s Emergency Loans to Banks Fall, But Remain High — Banks once again reduced their borrowings from two Federal Reserve backstop lending facilities in the most recent week, a sign the financial stresses that emerged following a string of bank collapses last month may be stabilizing. Emergency borrowing retreated for the third straight week, suggesting liquidity demand continues to ease following the second-largest bank failure in US history. Over the past few weeks, banks appear to have shifted a larger share of their borrowing out of the discount window, the Fed’s traditional backstop lending program, and into the new emergency lending facility it launched last month to help stem contagion in the bank sector.
4. March Jobs Report Shows Hiring Gradually Cooling — Employers added 236,000 workers last month, a historically strong gain but the smallest in more than two years, the Labor Department reported. The unemployment rate ticked down to 3.5%. More Americans jumped into the labor market in March, helping take pressure off wage increases. Average hourly earnings rose 4.2% last month from a year earlier, the smallest annual gain since mid-2021 when inflation was surging.
Steady hiring growth last month could keep the Federal Reserve on track to consider raising interest rates again at its meeting in early May. But slower wage gains could also allow officials to hint at a pause after that. Fed officials have signaled they will pay close attention to other measures of economic activity including bank lending conditions as they debate their next move.

The week ahead — Economic data from Econoday.com: