Investors are looking for signals from US Federal Reserve chairwoman Janet Yellen about the central bank’s next interest rate move after shockingly weak payroll data all but killed off chances for a hike this month, Reuters reports.
But the focus will also not stray far from developments in Britain as voters there prepare to vote in a referendum on June 23 on whether to stay in the European Union.
Expectations for the next Fed rate hike were knocked back to at least next month or later after US non-farm payroll data showed Friday that US employers added only 38,000 jobs in May, far below expectations of 164,000.
At an event Monday in Philadelphia, Yellen gets her last chance to offer insight into Fed thinking before a media blackout takes effect before the June 14-15 monetary policy meeting.
“We will have to listen carefully for her analysis of what definitely is a deterioration of the labor market conditions,” economists at BNP Paribas wrote in a note.
Investors will be looking to see whether Yellen, who said last month she expected interest rates to rise “in the coming months”, sticks to her tune after the data.
The Fed raised its key benchmark interest rate in December for the first time in nearly a decade, but has held off since then owing to concerns earlier this year about a global economic slowdown and financial market volatility.
The latest polls on British voters’ intentions in the EU referendum will guide investor risk appetite, recent surveys suggesting the Brexit camp is making creeping gains.
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