Bloomberg Surveillance · Friday, September 4, 2026
The strong August jobs report is seen as potentially supporting a Federal Reserve rate hike in September. This is because a solid labor market might give the Fed more confidence to address inflation without causing excessive job losses. The market is pricing this outcome, leading to a 'coin flip' scenario for the September meeting.
“This, I think, the report we got from the labor market, I think the market is pricing this right. This goes in the favor of the Fed officials who think it's time to start hiking.”
“Because a risk of doing the rate hikes to bring inflation down is you take away jobs that you didn't have to take away because inflation was going to get better. If the labor market looks pretty solid- then okay, like maybe we'll, you know, work on the inflation piece. So I think this does, today's report probably does fit more on those who are looking to potentially hike in a couple weeks.”
“So I think we are going to go into the September meeting with really a coin flip.”