Flexible Fed

fedThe Fed wants to raise short-term rates, and the three most important labor market variables they’re looking at are payroll growth, the unemployment rate and the change in average hourly earnings. Last Friday’s employment report offered no good news. Payroll growth at 126,000 was half the level expected by economists, the unemployment rate remained unchanged, and wage growth showed no upward trend. A June rate hike is off the table.

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