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"Fed's Mouthpiece": A surge in unemployment rate may garner wider support for a 50bp rate cut

"Fed's Mouthpiece": A surge in unemployment rate may garner wider support for a 50bp rate cut

Bitget2024/09/06 01:35

"Federal Reserve mouthpiece" Nick Timiraos stated that Friday happens to be the last day before Federal Reserve officials enter a pre-meeting quiet period. Fed Williams and Fed Governor Waller are scheduled to speak after the employment report is released, which is the last chance to set expectations for the upcoming meeting. With economic growth and inflation slowing down, it would be more reasonable for the Federal Reserve to adjust interest rates from around 5.3% currently to about 4.5%. If there are no signs indicating that July's job weakness will continue into August, some Fed officials may resist a substantial rate cut of 50 basis points. However, officials who were open-minded about rate cuts at the July meeting might support a 50-basis-point cut in September if unemployment jumps again and job growth slows further; they will gain broader support.

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