Headlines in the holiday-shortened US trading week will revolve around Kevin McCarthy’s efforts to shepherd a debt ceiling accord agreed over the weekend through the House, where some of the same unruly GOPers who made a show of denying him the gavel in January will doubtlessly dramatize the final legislative sprint.

If that process looks anything like the speakership vote it could make for some tense moments, but I doubt the bill will ultimately be allowed to fail. If it does (or looks like it might), I don’t know what to tell you — popcorn and puts, I guess.

Absent failure, or the specter thereof, traders will focus on the usual first-of-the-month, top-tier data releases out of the world’s largest economy including, of course, the May jobs report. Consensus is looking for 195,000 from the headline NFP print.

Not that anyone needs a reminder, but the jobs data has consistently topped economists’ forecasts, and by “consistently” I mean it’s been over a year since a downside NFP miss. That said, recall that April’s report came with meaningful negative revisions to the prior two months’ headlines, which tempered an otherwise blazing-hot read on the labor market.

On an unrounded basis, average hourly earnings rose at the briskest monthly pace in more than a year last month, rekindling wage-price spiral fears. Markets will thus be watching the AHE prints even more closely than they would’ve anyway.

Additional evidence of upward wage pressure would add to a hawkish narrative that gathered adherents last week, when a robust read on consumer spending and above-consensus PCE price data underscored the message from a bevy of Fed speakers who recently argued against complacency in the inflation fight.

It was amusing that Bloomberg, in their week-ahead preview, went ahead and assumed the jobs report (and the accompanying AHE figures) will come in as expected, despite economists’ poor track record. “US employers are gradually dialing back the pace of hiring and hourly earnings are moderating, offering some solace to Fed policymakers in their bid to wrangle still-elevated inflation,” Vince Golle and Craig Stirling wrote.

That’s the exact opposite of what recent data suggest. Golle and Stirling were writing as though they already had May’s NFP report in hand. To be fair, they went on to use words like “projected” and “probably,” but we should be careful to note that as things stand, the zeitgeist is shifting back in the direction of “no landing.” The June FOMC meeting is priced as a coin toss now. Terminal rate pricing hit a post-SVB high around 5.30% last week. And so on.

The JOLTS update, due Wednesday, is arguably just as important as NFP. Job openings are seen at 9.35 million on the last business day of April. If confirmed, that’d be the least in two years. If you’re old enough to remember three weeks ago, you’ll note that the last JOLTS report showed openings fell more than expected for a second consecutive month, bringing the three-month decline to 1.644 million.

I like to highlight the chart above from time to time. In simple terms, it shows that this has been, and still is, an openings story. Employment as a percentage of the labor force is largely unchanged. It was openings as a percentage of the labor force which drove the overheating.

Although inflation is proving to be just as stubborn as critics of the “transitory” narrative said it might be, the “soft landing” crowd does have one thing going for it: Job openings have declined dramatically with no attendant increase in the unemployment rate. That simply hasn’t happened before.

“It is hard to overstate how unusual the recent experience has been,” Goldman’s Jan Hatzius wrote two weeks back.

The figure on the right above shows that while job openings continue to drop versus the peak, the unemployment rate hasn’t budged. In fact, it just moved back to a 70-year-low.

The implication is that as job openings continue to disappear, wage growth will recede to levels consistent with stable prices as workers’ bargaining power wanes in the face of falling labor demand. Goldman (and others) see some progress in that regard, but suffice to say wage pressure remains and as such, so does inflation.

In addition to NFP and JOLTS, traders will get a fresh read on job cuts courtesy of Challenger, ADP private payrolls, Conference Board consumer confidence, updates on both marquee national home price indexes and ISM manufacturing for May. Fed speakers include Barkin, Bowman, Collins, Harker and Jefferson.

Elsewhere, PMIs out of China will be eyed very closely in light of disappointing data and fading enthusiasm for Chinese equities.