Productivity rose 3.7% in the preliminary Q2 reading (consensus 1.7%) following a 2.1% decline in the prior reading.
Unit labor costs rose 1.6% in the preliminary Q2 reading ( consensus 2.7%) following a 4.2% increase in the prior reading.
Weekly initial jobless claims totaled 227,000 (consensus 225,000) following last week’s count of 221,000.
Continuing claims came in at 1.7 million following last week’s revised total of 1.679 million (from 1.690 million).
The key takeaway from the report is that the pickup in productivity and the deceleration in unit labor costs is a good combination for the soft-landing view.
Treasury yields turned higher in response.
The 10-yr note yield is up 10 basis points to 4.17% and the 2-yr note yield is up three basis points to 4.92%.