Wall Street sees Fed rate hike after blowout jobs report

MacroDigital Finance Impact 4
โดย Yahoo Finance·US·Read original
Summary · why it matters

Wall Street sees a blowout jobs report and spiking Treasury yields as another sign that the Fed is going to have to hike rates to clamp down on inflation. The US economy added 162,000 jobs last month, blowing past economists' expectations. "They're a little bit behind the curve," Joe Brusuelas, RSM chief economist, told Yahoo Finance, in reference to the central bank. "They're going to need to hike rates if they want to reinforce their credibility, and that's going to cause a lot of problems at 1600 Pennsylvania Avenue." The Trump administration has been pushing hard for lower rates, with the president threatening a trade embargo if they don't. Fed Chairman Kevin Warsh has been mum about forward guidance, though his speech in Jackson Hole last month was seen as hawkish. On the day before the Fed's communication blackout period began, Fed Governor Christopher Waller signaled support for keeping rates steady if next week's inflation report shows easing prices. "I think we are leaning into the direction of a Fed hike," R.J. Gallo, Federated Hermes chief investment officer for global fixed income, told Yahoo Finance. On Friday, Macquarie analysts moved their rate-hike expectation from December to September, with a second one due in the first quarter of 2027. Polymarket bettors have priced in a 53% chance of a rate hike versus a 48% chance of a rate hold at the Sept. 15-16 meeting. The turmoil in the bond market also comes as the AI trade powers ahead, with Nvidia nearing all-time highs and reports that AI developer Anthropic is preparing to go public. UBS analysts said investors should reassess their portfolios and potentially use stock pullbacks as an opportunity to add exposure. When it comes to bonds, some strategists recommend a barbell approach, positioning for both possible Fed outcomes.

Impact on stocks 3

Artificial Intelligence▲ · 1 stocks
Others▲ · 2 stocks
％Effective Federal Funds Rate
EFFR
▲ PositiveMonetaryrelevance

Blowout jobs report and spiking yields increase likelihood of Fed rate hike, raising the effective federal funds rate.

Off-coverage companies 1

AnthropicPrivate▲ Positive
Capitalrelevance

Reports that AI developer Anthropic is preparing to go public, a significant capital markets event.

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