Fed Hike Off the Table for June Given Step Back in Job Growth

Slowdown in payroll growth will make the Fed more cautious, economists say

by Greg Robb
Market Watch

The slowdown in employment in April will keep the Federal Reserve on the sidelines at its next meeting in June, analysts said.

Kevin Logan, chief U.S. economist at HSBC, said Fed officials were already ambivalent about raising rates in June and the latest jobs report will just add to their caution.

“It means there is nothing compelling to push the Fed to decide it is appropriate to raise the funds rate,” he said.

Fed officials had thought that the turmoil in financial markets in the first few weeks of the year would be a “flash in the pan,” but the data suggest more lasting damage, Logan said.

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