US job growth accelerates in June, rate cut still likely

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US job growth accelerates in June, rate cut still likely

Job growth in United States would likely to experience a rebound in June, while wage growth is expected to accelerate, however, latest employment data might not be enough to encourage Federal Reserve to step off of their latest policy to trim interest rate as early as this month, multiple analysts commented on Friday, the 5th of July 2019, ahead of a US non-farm report scheduled to be released at the later part of the day.

In point of fact, lack of solid evidence that rising bitterness between Washington and Beijing would be resolved in a near-term outlook, had been forcing Federal Reserve to throttle on rate cut policy, though a majority of US banks had been quoted saying that an interest rate cut might not come until August.

Nonetheless, in context of a low inflation indication alongside heightening risk over US economy from an exacerbated trade spat with China, last month Fed signaled an interest rate cut as early as this month. Although US President Trump had reached a trade truce with his Chinese counterpart Xi Jinping last week and pledged not to impose tariffs on the remaining Chinese exports, and US job growth would likely to be surged, a rate cut might not be averted amid a backdrop of slowing economy, while expressing optimism over a 25-basis point rate cut this month, a senior economist at Wells Fargo Securities in Charlotte, North Carolina, Sam Bullard said, “Given signs of slowing growth and little material progress on the trade war, a rebound in job growth would still leave the Fed on course to cut rates at the July meeting and we expect a 25 basis points cut”.

According to an analysts’ forecast poll, non-farm payroll would likely to increase by 1,60,000 last month after adding only 75,000 jobs in May.