PiCK
BlackRock Says Strong US Jobs Shift Focus to Inflation, With Energy Prices the Key Risk
Summary
- BlackRock said US nonfarm payrolls for August came in stronger than expected, pushing US Treasury yields higher.
- BlackRock said the Fed would likely hold rates steady at its September meeting if inflation continues to ease.
- BlackRock said the key risk is that rising energy prices could feed into core inflation, and that even a 25-basis-point rate hike would likely have only a limited impact on stocks and credit markets.
Forecast Trend Report by Period
A stronger-than-expected US employment report for August has shifted market attention to next week’s Consumer Price Index data and the Federal Reserve’s September rate decision.
Walter Bloomberg reported on September 4 that US Treasury yields rose after August nonfarm payrolls increased by 162,000, beating market forecasts, citing Jeff Rosenberg, a portfolio manager at BlackRock.
Rosenberg said the Fed would likely hold rates steady at its September meeting if inflation continues to ease. He cited the risk that higher energy prices could spill over into core inflation as the bigger concern.
He also said a 25-basis-point increase in the benchmark rate would likely have only a limited impact on stocks and credit markets. One basis point equals 0.01 percentage point.
JH Kim
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