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Thoughts on NFP's impact on rate hike expectations?
The NFP data dropping next week is definitely on my radar. With the Fed signaling a data-dependent approach, I'm trying to gauge how a strong or weak print might shift the market's perception of another rate hike. Are we looking at a situation where a hot NFP solidifies another 25bps, or is the market already pricing that in to some extent? Curious to hear others' read on this given the recent inflation commentary.
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Given the Fed's penchant for ambiguity, it feels like a strong NFP print will simply lead them to ponder whether they should raise rates, and a weak one will lead them to ponder the same. Essentially, the market will price in whatever narrative supports the most dramatic headlines.