However, as Politico noted, he did not say anything to refute the belief that the Fed will likely cut rates at its next meeting on September 17-18 in Washington.
While some analysts expect the Fed to cut rates by 50 basis points, Rebecca Walser, president of Walser Wealth Management, expects a cut of no more than 25 basis points.
“I don’t expect more than 25 basis points, I think that Powell obviously indicated that they would be accommodative based on his comments on Friday after the job reports came out,” Walser tells Yahoo Finance’s YFi AM, “130,000 [jobs], a little bit weaker than we had expected, but it still shows wage growth, it still shows low unemployment...”
In August, 130,000 nonfarm payrolls were added versus 160,000 expected — but the unemployment rate was just 3.7%.
“We could be approaching full employment, so that is hard to keep adding jobs at a pace of 165,000 jobs a month when you have so many jobs that have been added over the last 18 months, 2 years,” Walser says.
For now, Walser, said, she doesn’t believe the Fed should be cutting rates preemptively. “I think we need to wait and see what happens with China,” she said, “and when we need a cut is when we don’t get a deal and the market really needs some stimulus.”