Financial Markets Daily Report08 abril 2024
Another employment report in the US reaffirming the tightness in the labor market moved financial markets' expectations for the Federal Reserve's first interest rate cut. As of today, a 25bp cut in June has an implied probability of 51%, compared with the 74% of Thursday's close. In the euro area, a June rate cut remains almost fully priced-in.
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- Another employment report in the US reaffirming the tightness in the labor market moved financial markets' expectations for the Federal Reserve's first interest rate cut. As of today, a 25bp cut in June has an implied probability of 51%, compared with the 74% of Thursday's close. In the euro area, a June rate cut remains almost fully priced-in.
- In March, 303k new jobs were created in the US (vs 214k expected and 270k in February) and the unemployment rate ticked down to 3.8%. Wages accelerated from 0.2% m/m to 0.3% and the year-on-year rate edged down to 4.1%.
- In this context, equities declined across the board and yields on sovereign bonds rose on both sides of the Atlantic, more notably in the US helped also by hawkish comments from Fed officials.
- This week the focus will be on March inflation figures for the US (Wed.), on the Fed's last meeting minutes (Wed.), and on the ECB monetary policy meeting, where we expect no change on official interest rates, (Thu.).