Federal Reserve Governor Michelle Daly expressed concerns about recent weak labor market data, highlighting a slowdown in job growth and rising unemployment. She noted that the labor market, once a pillar of economic resilience, is showing signs of strain as hiring slows and job openings decline. Daly emphasized the need for continued monitoring of labor market trends ahead of the Fed’s next policy meeting in September. Markets reacted cautiously to Daly’s remarks, with investors reassessing the likelihood of future rate cuts. The U.S. dollar weakened against major currencies like the euro and yen, reflecting growing speculation about Fed easing. Traders are now pricing in a 70% probability of a 25-basis-point rate cut at the September meeting, up from 50% earlier in the week. The implications for global markets are significant, particularly for emerging economies reliant on dollar liquidity. Gulf investors should watch for shifts in capital flows and commodity prices, which could be affected by a weaker dollar. Key indicators to monitor include August nonfarm payrolls and the Fed’s inflation forecasts in the upcoming policy statement.
مباشر