Nick Timiraos says today's jobs report wasn't alarming enough to put a July rate cut on the table (pricing is just 5%) but says that it could open up a real debate about September.
The June jobs report will make the July Fed meeting more interesting because there may be—for the first time all year—a real debate over whether to cut at the *next* meeting (in September)
The thing is, the Fed will need to lay out some stronger hints of a cut but he also highlights next week's CPI report as a key variable ahead of the July 30-31 meeting.
The Fed’s policy debates are inertial, owing to officials’ desire to telegraph clearly their decisions. As a result, policy meetings tend to focus as much on what officials should do next time as on the outcome of the current meeting.
That means a central focus of the July meeting will be if and how the committee signals its openness to a September cut.
The market is pricing in a 79% chance of a cut at the September meeting.
