Traders More Comfortable With a Fed Pause as Key Jobs Data Looms
- Fed speak favoring a June pause sways bond market rate bets
- Payrolls data loom as the next big test for Treasury bulls
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US interest-rate markets are signaling that the Federal Reserve is more likely to pause on rate hikes than tighten further at its June meeting, ahead of “make or break” data on the state of the US labor market.
With Friday’s non-farm payrolls figures looming, Thursday’s release on private hiring from ADP showed a stronger-than-expected picture, briefly buoying policy-sensitive short-end Treasury yields. That move was quickly reversed, however, as weekly jobless claims data landed largely in line with estimates and the pace of unit labor cost gains in the first quarter was revised lower.