(Bloomberg) — The world’s biggest bond market whipsawed after the latest jobs report left traders wondering whether or not the Federal Reserve will deploy a super-sized rate cut in September.
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While Wall Street boosted bets on a half point Fed reduction in the immediate aftermath of Friday’s labor-market data, many market observers said that’s not necessarily what the Fed will do. All around trading desks, the prevailing view is that the labor market is indeed softening — but it’s not weak enough to warrant an aggressive move from officials at this point.
“A softer-than-expected jobs report may support those in favor of a 50 basis-point rate cut in September, but the jury is likely still out,” said Chris Larkin at E*Trade from Morgan Stanley. “For now, a 25…
