Global markets are currently in a holding pattern, awaiting the release of the US employment report. This report, due out today, is expected to provide key information on the health of the US labor market and will likely influence the Federal Reserve’s decision on interest rates.
Recent economic indicators point towards a gradual slowdown in job growth, with forecasts predicting an increase of 185,000 jobs in May. However, a significant jump in the unemployment rate is unlikely, with most expecting it to remain at 3.9%.
This potential cooling in the labor market has revived expectations of a Fed rate cut. With Treasury yields hovering near two-month lows and the dollar weakening, investors are anticipating a decrease in rates as early as September.
The global market reaction to the US jobs report remains to be seen. While concerns about a potential recession are low, China’s underperformance and Europe’s cautious stance on further rate cuts are casting some shadows. Additionally, the performance of Nvidia’s stock following its pre-announced split is another point of interest for investors.
Source: Reuters