ATFX - More good news on the way? Economist: There is little urgency for the Federal Reserve to raise interest rates in September

atfxAlthough Federal Reserve Chairperson Jerome Powell has left the door open for another rate hike，But Wall Street economists believe that，At the Federal Reserve9Before the monthly meeting，Signs point in one direction：Pause rate hikes。

policy makersupZhou said，They are waiting for the upcoming announcementdata，To guide them at the next meeting of the Federal ReserveupThe decision whether to raise interest rates。The latest muted inflation report, signs of a slowdown in consumer spending, and evidence of falling wage pressures all point to，9The urgency of monthly interest rate hikes is limited。

Economists say，At the Federal Reserve9January 19Before the meeting from the 20th to the 20th，projected inflationdataWill furthercool down，whileThe downside of restoring student loan payments will also beimpacteconomy，This will give them more reasons to delay rate hikes，Even if only temporarily。Market expectations9The probability of a monthly interest rate hike is around 20%.。

Bank of Montreal chief economist Douglas Porter said，“I doubt it.dataWill be moderate enough to satisfy the Federal Reserve'srequest”，"Our core point is，The Federal Reserve has done enough，Short-term real interest rates are now stable at positive levels，Core inflation is starting to decline，whileThe labor market is also starting to weaken. "。

Omair Sharif, president and founder of Inflation Insights, estimates that，The core CPI, which excludes food and energy, is likely to increase only in July and AugustupUp 0.2%。He called this period the "summer of disinflation"。before，The Federal Reserve's Preferred Inflation in JunedataBetter than expected。upFriday'sdatashow，The PCE price index fell to a two-year low of 3%。

The United States FOMC (FOMC)upThursday's interest rate rangeupTo a 22-year high of 5.25% to 5.5%。Powell said，9The possibility of further rate hikes will be discussed "on the spot" at the month's meeting，The results will depend on the "upcoming overalldataAnd its impact on the futureimpact”。

ATFX-economist Anna Wong says，So far.，The slowdown in wage growth is due to the economic slowdowncool downOne aspect of，This convinced Federal Reserve officials，The labor market is slowing down，Powell said it was necessary to continue to contain inflation。"This report and another showing that the core PCE price index is growing at a pace consistent with the Federal Reserve's 2% target strengthen our view，The FOMC will be9Meeting of the monthupKeep interest rates stable "。

There is considerable evidence that，Core inflation, excluding food and energy, is falling。According to Mannheim Auctions, the world's largest used car dealerdata，As an important fluctuation factor，Used car prices fell in the first 15 days of July。According to rent.com research，Since August 2022，The rental price of apartments in the United States has declined slightly。

The Federal Reserve's SLOOS report released on Monday shows，creditGoing furthertighten，This is the latest evidence of a weakening economy。Policymakers will release a new non-farm report this week，Analysts expect the report to show a further slowdown in the job market。

Since the beginning of last year，The Federal Reserve has taken its own measuresupThe most aggressive tightening since the 1980s to contain inflation。Inflation will reach its highest level in 40 years in 2022。Although policymakers suspended interest rate hikes in June，To evaluate previous measuresimpact，But they also hinted at the time，Two more rate hikes by the end of the year may be appropriate。

Sharif said，to9month，The FOMC is likely to lower its core inflation forecast for 2023 from 3.9% down to 3.6% or 3.7%。With this adjustment，self-proclaimed dependencydataFederal Reserve officials may have a hard time explaining the reasons for the recent rate hikes。

Powell has been particularly concerned about prices in the service sector，Restaurants, hotels, and hair salons are being driven by the tight labor market，But the Federal ReserveupThere was also good news on Friday。U.S. Bureau of Labor StatisticsupAnnounced on Fridaydatashow，The quarterly rate of labor employment wages that measures wages and benefits is onlyup1% rise，This is the lowest increase since 2021。

These reports are consistent with Powell's views，That the economy can slow to a "soft landing"，Inflation will then return to the 2% target，whileThere will be no economic downturn or serious damage to the labor market。thenwhile，The outlook for economic growth faces some threats，These threats could prompt caution about more short-term interest rate hikes。

Before student loan payments resume in October，The Federal Reserve mayWill hesitate。Economists at PNC Financial Services Group say，For 27 million borrowers，Student loans average $350 to $400 per month，There will be a mild negative impact on consumer spendingimpact。The Federal Reserve will also keep a close watch on the impasse in CongresswhileCause the governmentshutdownpossibility，Although they may judge itimpactMay be short-term。

Even in9Monthly suspension of interest rate hikes，Powell and the FOMC may also hope to meet in November and DecemberupKeep their options open，And they will be cautious about declaring victory in the fight against inflation too soon。

Rubeela Farooqi, chief US economist at High Frequency Economics, said，"The Fed's actions are no longer based on forecasts，Because they have made mistakes before "，"Now they want todataConfirmed in "。

Tom Porcelli, chief US economist at PGIM Fixed Income, said，"I want to emphasize that，The improvement in inflationprocessIt's not as linear as everyone would like it to be. "，“dataIt's starting to slow down.，processCan be bumpy，But the overall trend will become clear by the end of the year”。