The ADP National Employment Report showed private payroll growth slow in May, the latest indicator of a cooling labor market. UBS Global Wealth Management Senior US Economist Brian Rose joins Morning Brief to discuss the print and what it could mean for the overall state of the economy.

"I don't think we should make such a big deal out of a small shortfall compared to consensus forecasts. The ADP has not been very useful in forecasting the monthly payroll prints, which is what will really move the market," Rose explains. He points to weaker hiring in sectors like hospitality as a post-pandemic normalization now that the vacant jobs caused by the pandemic have mostly been filled.

He explains that despite the weak report, "things are looking good for the soft landing scenario that the Fed has been aiming for."

"The Fed does face a tricky situation, though. I think there's a sense that if they leave rates at this level for too long, it could trigger a recession. So the Fed is trying to balance the risk," Rose adds.

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This post was written by Melanie Riehl