On August 7, the U.S. economy unexpectedly saw a decline in employment in July, and the previous month's nonfarm payroll figures were revised sharply downward, potentially raising questions about whether the Federal Reserve will raise interest rates next month. Friday's employment report noted that nonfarm payrolls decreased by 23,000 last month, following a downward revision to June's job growth to 20,000. However, employment data tends to be relatively subdued in July. Economists generally believe the labor market is in a state of "slow hiring, slow layoffs." Despite the Middle East situation now entering its sixth month, the economy appears to have managed successfully, with second-quarter domestic demand growing at the fastest pace in three years. As the labor force participation rate declined further, the unemployment rate fell to 4.1% from June's 4.2%. Ahead of the report's release, financial markets had expected the Fed to raise interest rates in September. Inflation data due out next week is expected to intensify the debate over short-term monetary policy prospects.