While the three-month average of US job growth is currently just 35,000, Chris Weston, head of research at Pepperstone, said Fed policymakers - especially those more concerned about continued core PCE deviations from the 2 per cent target - would back an "insurance cut" only after the August non-farm payroll data, due on September 5, showed renewed weakness.
He added that the Fed's credibility was being severely tested. Cutting rates in September when core PCE is expected to be 100 basis points above target would be a difficult decision in any environment. Weston also pointed out that it is not yet clear whether the tariff transmission effect will gradually become apparent. (Golden Ten)
Agencies: Fed "inflation fears" will only support interest rate cuts if non-farm payrolls weaken again in August
2025-08-22 02:07:06
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