Santander Bank: Despite Weak June Employment Data, Fed Will Still Focus on Inflation

Odaily Odaily Planet Daily News Evercore ISI stated, "Employment data is returning to normal, and the Fed will still focus on inflation." Economists believe that the Fed will view the weak June employment data as a return to normal levels for hiring data after several months of unexpectedly strong growth. They said, "Some believe this report has significantly reduced the likelihood of a rate hike this year. We do not entirely agree with this view."

Santander Bank analyst Stephen Stanley also echoed this view. He said, "Inflation data will determine the Fed's course of action." He believes that the June employment report may "slightly" change the views of Fed officials, but he expects most policymakers still see the labor market as stable. "There has been a considerable overreaction in financial markets, including a reduction in the probability of a rate hike this year. I believe the latter is an inappropriate reaction to this report." (Jin Shi)