US: Plenty to ponder for the economy – ANZ

Analysts at ANZ suggest that while the latest disappointing US payrolls report has not derailed expectations that the Fed will hike again next week (ANZ still hold that view too), it has certainly added to questions over the extent of any future tightening (and longer-term yields more generally), especially as it comes at a time when there are some signs that core inflation is rolling over again.

Key Quotes

“We still see US yields higher by year end (and believe the market is under-pricing the Fed), but with Comey testimony, the UK election and the ECB meeting all this week, we doubt the market will want to run with that.”