For more information, please contact me at (512) 261-1542 or steve@LoneStarLending.com.
By G. Steven Bray
Last Fri’s jobs report was supposed to be a defining event. Solid job gains were supposed to give the Fed the green light to raise short-term interest rates again in a couple weeks. I guess someone forgot to tell the employers. Instead, we got a mediocre jobs report and an excuse for the Fed to equivocate some more.
The actual jobs created were 151k. By itself, even this mediocre report could have given the Fed cover for raising rates given that Fed governor Lockhart said 150k would be good enough. However, the report was bookended by important reads on, first, manufacturing and, today, the service sector of the economy. Both reports were much weaker than expected and, I suspect, put a rate hike back on hold.
So, where does that leave us? It looks like we’ll be riding the range a while longer. The European Central Bank meets this week, but I think it’s unlikely to stir markets much. The next significant event is the Fed meeting in two weeks, and absent something unexpected, I expect rates will remain in a holding pattern until we get closer to the meeting.
Sorry, the comment form is closed at this time.