Guotai Haitong Securities released a research report stating that August US non-farm employment additions were significantly below expectations, with the US job market showing dual weakness in supply and demand. The institution notes that companies have not yet implemented large-scale layoffs or significantly reduced working hours, but unemployed workers are finding it increasingly difficult to secure new jobs quickly, creating a fragile "tight balance" state. The firm believes the US job market may maintain this tight balance for some time. The weak August employment data may pave the way for a September rate cut, though whether continuous rate cuts can begin after September remains highly uncertain.

**August Non-Farm Data: Significantly Weaker Than Expected**

August US non-farm employment additions totaled only 22,000, well below market expectations. Additionally, June and July non-farm employment figures were revised downward by a combined 21,000. June data was further revised down by 27,000 to -13,000, marking the first negative non-farm employment growth since December 2020. July data was revised upward by 6,000 to 79,000.

**US Job Market: Fragile Tight Balance**

The "balance" is reflected in two aspects: First, despite rising labor force participation rates, unemployment rate increases have not significantly exceeded market expectations. Second, the forward-looking indicator of average weekly hours remains stable.

The fragility is evident in: First, the proportion of long-term unemployed continues to rise. Second, private sector job additions remain concentrated in specific areas. Overall, the current US job market exhibits dual weakness in supply and demand, with companies not yet implementing large-scale layoffs or significantly reducing working hours, but unemployed individuals finding it increasingly difficult to secure employment quickly.

**Will the Tight Balance Be Disrupted?**

Historically, August non-farm employment initial readings typically show weakness and are usually revised upward in subsequent months. Current US unemployment claims data has not significantly deteriorated, and with the Federal Reserve's upcoming rate cuts supporting the economy, the US job market may maintain its tight balance for some time.

**Federal Reserve: September Rate Cut of 25BP Highly Likely**

The weak August employment data may pave the way for a September rate cut. Even if August inflation data exceeds expectations to some extent, it may be interpreted as a one-time shock from tariffs and temporarily overlooked, unlikely to significantly constrain September rate cuts. However, whether continuous rate cuts can begin after September remains highly uncertain and requires monitoring of subsequent employment and inflation data.

**Risk Warnings:** Trump's political pressure escalation further threatens Federal Reserve independence; non-linear deterioration of US unemployment rate.