The US jobs report showed a solid gain of 235K and an annualized wage rise of 2.8%. This should be good enough for the Fed:
Here is their view, courtesy of eFXnews:
Today’s jobs report removes the last obstacle for a Fed hike on Wednesday, argues Danske Bank Markets.
“A hike is the consensus among analysts and fully priced in by markets. The interesting question is how many hikes to expect for the rest of the year. Although the FOMC members have signalled a March hike, they have also repeated that they think three hikes are appropriate. We expect the Fed to maintain the ‘dot’ signal for this year unchanged at three hikes in the updated projections,” Danske argues.
Moreover, Danske Bank expects the Fed to hike three times this year in March, July and December.
“We stick to our view that the Fed is only set to hike once in H1 17 but now twice in H2 17 when we get more information about Trumponomics. By hiking at one of the small meetings in July, the Fed shows that it means that every meeting is ‘live’. We expect the Fed to begin the reduction of its balance sheet in Q1 18,” Danske adds.
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