Washington, DC, July 8 (BNA): The Federal Reserve is likely to raise its benchmark interest rate later this month to a range of 5.25%-5.5%, traders bet on Friday, though they priced the chance a little lower for any further hike after it showed A government report said employment slowed more than expected in June.
Traders now see a 20% chance of a rate hike in September and a 40% chance by November, after what is almost universally expected to be a quarter-point increase at the US central bank meeting in late July.
Prior to the Labor Department report, they had seen a near equal chance that rates would reach a 5.5%-5.75% range by November, Reuters reported.
Karim Basta of III Capital Management wrote that the report, which showed employers hired 209,000 workers last month, is “consistent with the steady and gradual slowdown of the labor market.” While that’s not enough to dissuade the Fed from raising interest rates in July, he said, the hike in September is “very much an open question.”
The Fed held its policy rate steady last month, targeting a range of 5% to 5.25%, but policymakers signaled more rate hikes ahead given unacceptably high inflation and its slow progress toward the Fed’s 2% target amid a job market. strong.
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