Investors Await Critical CPI Report After Hot Jobs Report
A stronger-than-expected August payrolls print (162,000 vs. 53,000 est.) undercut the labor-softness case, trimming September hike odds to 55.7% from 64.3%, with Thursday's PPI, Friday's CPI, Apple's keynote and Oracle's results the next inputs for the rate outlook.
Stronger August payrolls weakened the labor-softness case that has anchored dovish arguments among monetary policymakers, while futures implied a lower probability of a September rate increase. Nonfarm payrolls rose 162,000 against a 53,000 estimate, and July was revised to +21,000 from -23,000. CF Benchmarks calculations put September 16 hike odds at 55.7%, down from 64.3% a week earlier. The 10-year Treasury yield fell 4 basis points to 4.76%, while the S&P 500 gained 0.1% over the week.
The Labor Day closure highlights the investor demand for venues for price discovery when traditional markets are closed. Across the September 4 to September 8 snapshot, the six most volatile xStocks each moved less than 2% in either direction. Separately, estimated xStocks volume rose 32.5% to $603.9 million over September 2 to September 8, with SPYx the most-traded token. Thursday's producer price index (PPI), Friday's consumer price index (CPI), Apple's keynote and Oracle's results are the next scheduled inputs for earnings expectations and the rate outlook.