Investing.com – Expectations for the upcoming period changed significantly immediately after the release of US employment data.
Investors raised the odds of a rate fixing by the Federal Reserve at this month’s meeting in the wake of surprising and missed employment data, according to .
At the same time, some changes occurred in Fed Swaps regarding interest, as this tool indicates interest expectations for the upcoming Fed meetings, as pricing shifted after the release of the data to the interest rate cut being in May instead of June next year.
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Recent Fed statements
Federal Reserve Bank of Atlanta President Raphael Bostick said: The US economy is expected to face some turbulence in the coming days Due to the strong increase in interest rates, which affects the volume of debt, whose services are now rising strongly.
Bostick said that in the US there are many bankers dealing with higher interest rates for the first time. He said that many loans were delivered at very low interest rates and now that the situation has changed it is necessary for them to be revalued according to the new higher interest rates which makes the value totally different.
He continued, “These days we hear a lot of talk about public debt, because it is one of the debts whose interest will be paid at a very high rate, which causes great pressure on all sectors, businesses, families and the public sector. This is what creates a new reality.”
Bostick believed that the US government should think seriously about how to deal with these many variables in the coming quarters, which will witness a greater reflection of the current monetary tightening.
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Recently released data
For the month of August, while experts expected an addition of 170 thousand, the previous reading was revised to record 157 thousand instead of 187 thousand.
While 179 thousand jobs were added in August, and expectations indicated an addition of 150 thousand, and the previous reading was revised to record 155 thousand instead of 172 thousand.
On the other hand, it recorded 3.8% in August. While experts expected it to record 3.5% as the previous reading.
It recorded 0.2% in August, while expectations were for an increase of 0.3%, and it recorded a previous reading of 0.4%. As for Ali, it recorded 4.3%, while expectations were for a rise of 4.4%, as was the previous reading.
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Interest pricing now
Expectations change to 94% in favor of fixing interest rates at current levels. This is after it was only at 90%. Which indicates that the markets are becoming more certain that the Fed will hold interest rates at the current range of 5.25% – 5.50%.
2023-09-01 13:32:00
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