Sterling holds ground amid stabilizing U.K. debt market
Investing.com -- Standard Chartered has revised its forecast for the upcoming Federal Reserve interest rate decision, now expecting a 50 basis point cut at the September meeting, doubling its previous projection of 25 basis points.
The bank’s updated outlook follows Friday’s weaker-than-expected U.S. jobs report, which showed unemployment rising to 4.3%, the highest level in nearly four years. The labor market data revealed a sharp slowdown in job growth during August.
In a note to clients released Friday, Standard Chartered described a rapid deterioration in employment conditions, stating the labor market had shifted "from solid to soft in less than six weeks."
The bank compared the current situation to developments last year, noting that "August labor market data has paved the way for a ’catch-up’ 50 basis point rate cut at the September FOMC meeting, similar to what occurred at this time last year."
Standard Chartered also suggested that following such a substantial rate reduction, markets might need time to adjust expectations for a more moderate pace of cuts in subsequent meetings.
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