Fed to Fast Forward Rate Hikes After Red Hot Jobs ReportKatherine Hamilton5 Aug 20220
The Federal Reserve will likely throw another round of supersized rate hikes at the U.S. economy following the sizzling hot jobs numbers the Department of Labor released Friday.
Up until yesterday, the federal funds futures market implied a 66 percent likelihood that the Fed would raise the current federal funds target rate — now at 2.25-2.50 percent — by another 50 basis points to a range of 2.75 – 3.0 percent. After the news that the U.S. economy added 528,000 jobs in July and the unemployment rate fell to 3.5 percent — much hotter than projections of a cool 258,000 jobs and a steady 3.6 percent unemployment rate — the odds shifted violently.
On Friday, the market implied a 69.5 percent chance that the Fed raises rates 75 basis points, resulting in a 3.0-3.25 percent range.
https://twitter.com/jasonfurman/status/1555538352379764737If the Fed raises rates in September, it will be the fourth time it has done so in 2022. At the last two meetings, the Fed hiked its interest rate target by 0.75 basis points, the biggest hikes since 1994. Fed officials say they are hoping to cool demand for labor to bring down inflation. July’s job numbers indicate that these hikes have not yet slowed job creation and the labor market remains extremely tight.
https://www.breitbart.com/economy/2022/08/05/fed-fast-forward-rate-hikes-after-red-hot-jobs-report/
