6 Apr 2015
June rate hike by Fed remains on the picture – SG
FXStreet (Barcelona) - According to Societe Generale, the weak US NFP doesn’t rule out a June rate hike, with the markets now pricing in a slower pace of hike post the release of the jobs data.
Key Quotes
“The March US payroll report came in a long way below expectations and you have to take a decent-sized step backwards to find a perspective that isn’t too negative. Payrolls increased by 126k, vs. expectations of 245k. Back-month revisions reduced employment by 69k.”
“The Household survey posted an even lower 34k increase. The unemployment rate stayed at 5.5%.”
“Average hourly earnings increased by 0.3%, which is 2.1% y/y and the older non-supervisory series saw a pick-up in wage growth from 1.6% to 1.8%.”
“Weekly hours dipped a touch to 34.5 from 34.6 so that the overall increase in hours worked slowed.”
“SG economists are not going to rule out a June rate hike…. And the market’s not having a big fight about it, with August Fed Fund futures up a whole 2 ticks. What the rates market IS doing, is pricing a slower pace of hiking after rates do get off zero. 1-year rates in 2 years’ time are priced at 1.59%, lowest since early February.”
Key Quotes
“The March US payroll report came in a long way below expectations and you have to take a decent-sized step backwards to find a perspective that isn’t too negative. Payrolls increased by 126k, vs. expectations of 245k. Back-month revisions reduced employment by 69k.”
“The Household survey posted an even lower 34k increase. The unemployment rate stayed at 5.5%.”
“Average hourly earnings increased by 0.3%, which is 2.1% y/y and the older non-supervisory series saw a pick-up in wage growth from 1.6% to 1.8%.”
“Weekly hours dipped a touch to 34.5 from 34.6 so that the overall increase in hours worked slowed.”
“SG economists are not going to rule out a June rate hike…. And the market’s not having a big fight about it, with August Fed Fund futures up a whole 2 ticks. What the rates market IS doing, is pricing a slower pace of hiking after rates do get off zero. 1-year rates in 2 years’ time are priced at 1.59%, lowest since early February.”