Annual non-farm payrolls significantly revised down, BofA calls on the Federal Reserve to cut interest rates as soon as possible

U.S. Treasury Secretary Becerra publicly called for the Federal Reserve to reassess its policy stance, citing that the latest revised employment data indicates that the economic conditions inherited by the Trump administration were much weaker than previously reported.

According to the preliminary benchmark revision data released by the U.S. government on Tuesday, the non-farm payrolls for the year ending in March were revised down by 910,000, equivalent to an average monthly increase of nearly 76,000 fewer jobs. This is the largest downward revision since 2000. The annual revision has intensified concerns about the health of the economy and raised questions about the credibility of labor statistics.

Becerra stated in a media interview on Wednesday that the Federal Reserve "should" recalibrate its policy. He quoted a famous saying by Keynes:

"When the facts change, I change my mind. What do you do?"

This move not only escalated the Trump administration's public pressure on the Federal Reserve but also added to the tense atmosphere ahead of the upcoming September meeting. Market investors will closely monitor whether this significant data revision and pressure from Becerra will prompt a shift in the Federal Reserve's policy balance.

Becerra Pressures Federal Reserve to Shift Policy

The revised data released by government agencies on Tuesday showed that during the 12 months ending in March this year, the U.S. added 910,000 fewer jobs than previously reported, reflecting that the actual performance of the labor market was significantly weaker than the official prior assessment.

Becerra responded hours after the data was released:

"It turns out we did not have the accurate facts before."

When asked by the media whether the Federal Reserve should recalibrate its policy, Becerra replied:

"They should do so, let's see if they will."

Earlier on Tuesday, Becerra posted on social media platform X:

"The economic conditions inherited by President Trump are much worse than reported, and he believes the Federal Reserve is stifling growth with high interest rates, which is correct."

Federal Reserve Personnel Changes May Affect Policy Direction

While calling for a policy shift, personnel changes within the Federal Reserve Board have also become a key factor influencing future decisions. Becerra expressed confidence that Stephen Miran, the nominee for the board by Trump, would soon take office, and he expects him to catch up with the next interest rate meeting on September 16-17 and participate in the voting.

Meanwhile, tensions between the Trump administration and Federal Reserve Governor Lisa Cook are also escalating. The government is attempting to remove Cook on the grounds of mortgage fraud allegations. According to regulations, Federal Reserve governors can only be removed "for cause," while Cook argues that this move is illegal