UBS reiterates June rate cut expectation after mixed labor report
UBS economists maintained their views that the Federal Reserve will begin cutting interest rates in June, projecting a total of three reductions by the end of this year.
However, “some softening of the data is likely required for that to happen,” analysts at UBS said in a note on Friday.
Their comments come after the latest US labor report revealed a significant increase in nonfarm payrolls for February, with the US economy adding 275,000 jobs, surpassing the anticipated 200,000.
Despite this growth, revisions to the past two months reduced figures by 167,000, leading to a three-month average of 264,000 jobs, indicating a slight decrease from the previous 289,000.
Nonetheless, the report also contained weaker data, with the unemployment rate climbing to 3.9% and a modest 0.1% rise in average hourly earnings.
Looking ahead, the markets will likely focus on consumer price index (CPI) data for February, which UBS expects will demonstrate “another strong monthly increase.”
Read more on investing.com
