{"id":103321,"date":"2024-07-05T21:04:00","date_gmt":"2024-07-05T17:04:00","guid":{"rendered":"https:\/\/noortrends.ae\/en\/?p=103321"},"modified":"2024-07-05T21:23:23","modified_gmt":"2024-07-05T17:23:23","slug":"fed-under-pressure-to-cut-rates-in-september-as-job-market-cools","status":"publish","type":"post","link":"https:\/\/noortrends.ae\/en\/fed-under-pressure-to-cut-rates-in-september-as-job-market-cools\/07\/05\/market-updates\/","title":{"rendered":"Fed Under Pressure to Cut Rates in September as Job Market Cools"},"content":{"rendered":"\n<p>June\u2019s jobs report sent a mixed message, with job gains have remained better than expected in a strong status but other indicators are suggesting a slowdown. This has increased pressure on the Federal Reserve to cut interest rates in September.<br><br><strong>Job Growth Flatters, Not Deceives: <br><\/strong><br>While headline numbers showed solid hiring, the unemployment rate rose and wage growth slowed. This suggests the labour market is cooling, potentially signaling a need for looser monetary policy.<br><br><strong>Market Anticipates September Rate Cut: <br><\/strong><br>Investors are largely expecting a rate cut in September, with the June jobs report solidifying this view. Economic data is pointing towards a slowdown, making a rate cut more likely.<br><br><strong>Shifting Policy: <br><\/strong><br>From Steady Rates to Potential Cuts:  The Fed initially projected no rate cuts in 2024, but forecasts indicated a growing number of officials favoring two cuts. Recent labour market data strengthens the case for a rate cut.<br><br><strong>Labour Market Takes Center Stage: <br><\/strong><br>The rise in unemployment brings the Sahm Rule into play, historically a recession indicator. This, coupled with slowing wage growth, suggests a potential need for Fed action to prevent a downturn.<br><br><strong>Investors Content, But Wary: <br><\/strong><br>While investors welcome the prospect of lower rates, they remain cautious given the strong stock market performance this year. Inflation remains a concern, with the Consumer Price Index report next week being a key data point. Investors appear content, but not overjoyed, by the prospect of an immaculate disinflation. And after all, the S&amp;P 500 just gained 14.5% in the first six months of the year.<br><br><strong>Focus Shifting from Inflation to Jobs?<br><\/strong><br>Recent data suggests the Fed might prioritize the labour market over inflation. While inflation is on a &#8220;disinflationary path,&#8221; rising unemployment could prompt the Fed to act swiftly.<br><br><strong>Powell&#8217;s Key Events: <br><\/strong><br>Prior to September\u2019s FOMC meeting, Fed Chair Powell&#8217;s upcoming Senate Banking Testimony, on July 9, and the Jackson Hole Symposium, in August, could signify a policy change towards a September rate cut.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>June\u2019s jobs report sent a mixed message, with job gains have remained better than expected in a strong status but other indicators are suggesting a slowdown. This has increased pressure on the Federal Reserve to cut interest rates in September.Job Growth Flatters, Not Deceives: While headline numbers showed solid hiring, the unemployment rate rose and &hellip;<\/p>\n","protected":false},"author":13,"featured_media":53410,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[37,39,36],"tags":[6868,7164,8626],"class_list":["post-103321","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-forex-markets","category-global-stock-markets","category-market-updates","tag-fomc","tag-powell","tag-rate-decision"],"_links":{"self":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/103321","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/comments?post=103321"}],"version-history":[{"count":3,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/103321\/revisions"}],"predecessor-version":[{"id":103329,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/103321\/revisions\/103329"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media\/53410"}],"wp:attachment":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media?parent=103321"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/categories?post=103321"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/tags?post=103321"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}