Good morning, happy Friday and welcome to FirstFT. In today’s newsletter:
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US economy is expected to add jobs after last month’s surprise fall
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Maria Bartiromo leaves Fox News
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UK failing to take advantage of Brexit, says top Trump official
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The ‘Texas miracle’ faces a challenge
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Is a university degree losing its lustre?
You can listen to today’s top news stories in the FT News Briefing podcast.
Global stock markets are flat this morning ahead of US government employment data due later. The yields on Treasuries extended yesterday’s falls after Fed governor Chris Waller said he would be “inclined” to keep interest rates on hold.
Economists estimate the non-farm payrolls report will show the US economy added 56,000 jobs last month after an unexpected fall in July.
Figures from the Bureau of Labor Statistics showed the US economy shed 23,000 jobs in July and the June gains were revised lower to 20,000 positions. Growth came in the healthcare sector but jobs were lost in education, retail and financial services.
The figures released later today are expected to show the unemployment rate held steady at 4.1 per cent and monthly earnings rose 0.3 per cent while annual pay increased 3 per cent.
National data released this week by ADP, the payment-processing company, was weaker than expected. The ADP figures showed that private-sector employment increased by 38,000 compared with 46,000 in July, revised up from 44,000 jobs.
A jobs report in line with expectations could help the Federal Reserve as it focuses on tackling rising inflation. Traders yesterday scaled back their bets on an interest rate rise at the Fed’s September 16 meeting following Waller’s remarks. Markets now put the chance of an increase at roughly 50 per cent compared with 59 per cent before Waller’s comments.
S&P 500 futures were little changed on Friday morning while the 10-year Treasury yield fell one basis point to 4.75 per cent. Brent crude eased towards $95 a barrel and the dollar was flat.
Here’s what else we’re keeping tabs on today and over the weekend:
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Italy: Prime Minister Giorgia Meloni will open an annual gathering of business and finance leaders on Lake Como as her three-party coalition celebrates becoming Italy’s longest-serving government since the second world war. What has it achieved?
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German elections: Saxony-Anhalt, a former communist state with 2.1mn inhabitants, will hold a closely watched election on Sunday. Friedrich Merz’s Christian Democratic Union party is expected to lose heavily to the far-right party Alternative for Germany.
Five more top stories
1. Fox News anchor and Donald Trump ally Maria Bartiromo has left the Murdoch-controlled broadcaster in one of the biggest shake-ups at the network since the exit of Tucker Carlson three years ago. Bartiromo has been with Fox since 2014 after a long career at CNBC but has not been on air since early August. Here’s what we know about her departure.
2. Javier Milei put the future of the Falkland Islands back at the centre of the political agenda last night, as tensions between the UK and US create an opportunity for his struggling government. Argentina’s libertarian president, a close ally of Donald Trump, pledged to speed up construction of a naval base in the province nearest the islands and to broaden sanctions against businesses involved in nascent oil projects in the British overseas territory.
3. China has warned that US accusations that Beijing scuppered a joint G20 finance ministers’ communiqué this week threaten to sour relations ahead of a series of high-profile summits. China objected to the phrase “non-market policies”, according to US and European officials, and resisted calls for the IMF and the OECD to improve data needed to analyse the issue.
4. The UK is choosing “Brussels over America”, causing a “problem” for London’s effort to expand a trade deal with the US, warned Donald Trump’s top negotiator. The UK had failed to take advantage of Brexit by aligning with EU-made rules and closing its market to American goods, US trade representative Jamieson Greer told the FT.
5. Volkswagen’s supervisory board has backed chief executive Oliver Blume’s plan for a sweeping overhaul that will see the German carmaker slash up to 50,000 jobs and could lead to plant closures. The company told investors on Thursday evening that the restructuring would be “the most extensive transformation programme” in its history. Its shares rose 6 per cent on Friday morning.
The Texas experiment
The “Texas miracle” has seen companies such as Tesla, Hewlett Packard Enterprise and Charles Schwab relocate to the state for low taxes, light regulation, abundant energy and cheap land. The “capitalism on steroids” model, however, comes with costs: Texas has the highest proportion of any state of residents without health insurance, above-average poverty and sluggish growth in real personal incomes. Meanwhile, data centre development is proving divisive in the business-friendly state and is threatening to overshadow the midterm elections.
We’re also reading . . .
Chart of the day
A new study finds that, after climbing for decades, the wage premium for college graduates in the US has fallen in every one of the past four years. John Burn-Murdoch finds a similar picture in the UK, where the long-run erosion of the graduate premium has accelerated in the past four years.
Take a break from the news . . .
Should we be cooking and consuming more food with blood? A number of chefs and food writers believe so for reasons to do with taste, sustainability and nutrition, writes food columnist Ajesh Patalay.
The FT Weekend Festival returns to Kenwood House Gardens in London and online tomorrow. Join Richard E Grant, Paul Smith, Mary Beard, Jeremy Hunt, Peter Capaldi, Angela Hartnett and many more leading thinkers, policymakers and cultural voices. Save your seat at ft.com/festival and use code FTNewsletters to save 10% off your pass.
