After Friday’s surprisingly weak US jobs report, the market is convinced that the Federal Reserve will cut interest rates on September 18. The only question that remains is whether it cuts by 25 or 50 basis points.
While no decision on monetary policy is ever set in stone 10 days beforehand, this looks like a reasonable assessment. The market is also correct to see an increasing likelihood of a 50 basis point reduction, although this is by no means certain.
