The Jobs Report May Force A September Rate Hike And Send Rates Soaring

This week’s economic data, including payrolls and JOLTS, will be pivotal for determining a potential September Fed rate hike. Inflation remains elevated, with July headline PCE at 3.7%, and labor market data signals tightening conditions and full employment. Odds for a September rate hike are near 50%, with even in-line data likely to push expectations higher; stronger data increases pressure. Technical resistance for 2-year and 10-year Treasury yields is limited above current levels, suggesting rates could climb sharply if data surprises to the upside.