Fed Has No Need to Raise Rates This Year, Says State Street Economist; Unemployment at 4.2%

According to Simona Mokuta, chief economist at State Street, on July 21, the U.S. Federal Reserve has no need to raise rates this year given conditions in the housing and labor markets. The June unemployment rate stood at 4.2%, matching the Federal Reserve's estimated non-accelerating inflation rate of unemployment (NAIRU), while recent data shows wage growth pressures continuing to ease. Mokuta noted that June CPI and PPI came in lower than expected, reducing near-term rate hike pressures. State Street maintained its forecast that the Fed will hold rates steady through year-end 2026.
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