SAN FRANCISCO (Reuters) – A jump in jobless claims reported Thursday wiped out any lingering trader expectations that the Federal Reserve will raise interest rates again in June and fueled expectations for rate cuts as the central bank’s next move.
Futures tied to the Fed’s policy rate rose after the report, which showed last week’s unemployment insurance claims rose to the highest since October 2021.
Rate futures now reflect a small chance the Fed will cut rates in June by a quarter of a percentage point from the benchmark’s current 5%-5.25% range. Traders added to bets that Fed rate cuts will begin in earnest in September.
(Reporting by Ann Saphir; Editing by Chizu Nomiyama)
