08/04/2023
π Market Update: Rates and Fed Meeting Expectations π
TLDR: Rates went up, rates came back down. Industry sources say 20% chance of rate hike at the next Fed meeting. Also: non-farm payroll, unemployment, manufacturing, jobs, Fed Funds Rate expectations, inflation.
π Market Performance Today π When the market opened this morning, fears surrounding today's non-farm payroll and unemployment rate data triggered a sell-off. Non-farm payrolls slightly exceeded Juneβs numbers but fell well short of expectations. Despite this, the market bounced back, erasing morning losses and pushing us into positive territory. A sigh of relief was felt, but it was tempered by an unexpected drop in the unemployment rate to 3.5%.
π Mixed Data This Week π Data has been mixed all week. While manufacturing data has underperformed, the labor market shows resilience. Job openings remain high, and monthly jobs reports continue to show robust growth. The declining unemployment rate is a positive sign, but it raises concerns about another possible rate hike in September. Market sentiment indicates a roughly 20% probability for another hike in the Fed Funds Rate, a significant rise from the 12% expectation just 30 days ago.
π Looking Ahead π
Volatility is expected as the market prepares for Thursdayβs inflation data. It will be the most critical day of next week, and the data will significantly impact the market. The Fed will continue to focus on labor market conditions and inflation. Labor market strength is evident, but if we witness elevated inflation, the consequences will be significant.
Author: Casey Delinsky, SVP Capital Markets, GO Mortgage
π£ Disclaimer π£ The author is not a financial advisor, and nothing stated above should be viewed as financial advice. Consult a professional investment advisor before making any investment decisions. The information provided above does not, and is not intended to, constitute legal advice, investment advice, or the opinion of GO Mortgage, LLC. Instead, all information, content, and materials are for general informational purposes only.