Jobs growth picking up a bit

The June payroll data released a few days ago bolsters the thesis that jobs growth is picking up. Jobs growth is still modest by historical standards, but it is improving, not deteriorating, and that is significant. 

Chart #1

Chart #1 shows the year over year and 6-mo. annualized rate of growth of private sector jobs. Given the volatile nature of month-to-month rates of change of this statistic, I think it is best to view it from a multi-month rate of change perspective. We now see that by both measures, jobs growth is picking up a bit. But at best, the current rate of growth is still less than 1% per year. 

Chart #2

Chart #2 shows the level of private sector and public sector jobs. Here we see that private sector jobs have picked up a bit, whereas public sector jobs have lost ground in the past year or so, thanks to Trump's efforts to downsize the federal bureaucracy. 

I don't see anything here that would justify or warrant a change in short-term interest rates. The economy is not on the verge of a sudden acceleration, nor is it on the verge of a downturn. 

Meanwhile, key indicators of inflation pressures bolster the case for lower inflation: non-energy commodity prices are down 4.5% from their pre-Iran levels, 5-yr breakeven inflation rates have fallen to 2.3% from an Iran-war high of 2.75%, and gold prices are down 10% and the dollar is up 3.5% since the end of February.