LACKLUSTER LABOR

Employers created a respectable 206,000 net June jobs, but April and May totals were reduced by a hefty 110,000 and the unemployment rate rose from 4% to 4.1%, its highest level since 11/21. While a July rate cut is unrealistic, the disturbing rise in the unemployment rate since the 4/23 low of 3.4%, along with steadily falling inflation, argues strongly for a September Fed rate cut. Policy is too restrictive.