Svmuu News: Evercore ISI stated, “Employment data has returned to normal, and the Federal Reserve will continue to focus on inflation.” Economists believe the Federal Reserve will view the weak June employment data as a return to normal levels following the unexpectedly strong growth in hiring seen in previous months.They said, “Some believe this report significantly reduces the likelihood of a rate hike this year. We do not entirely share that view.”
Stephen Stanley, an analyst at Santander, also agreed with this assessment. He said, “Inflation data will determine Federal Reserve’s course of action.”He believes the June jobs report may “slightly” shift the views of Federal Reserve officials, but he expects most policymakers to still view the labor market as stable. “Financial markets have overreacted quite significantly, including by lowering the probability of interest rate hikes this year. I think the latter is an inappropriate reaction to this report.” (Jin Shi)