Fed May Raise Rates in December, Probably Not September, Economist Tells CNBC
NEW YORK (TheStreet) -- The Federal Reserve will most likely not raise interest rates at its September meeting, despite the strong June jobs report released this morning, Goldman Sachs' (GS) - Get Report chief economist Jan Hatzius said on CNBC's "Squawk on the Street" Friday.
"We have a 25% probability for a hike at the September meeting so we don't think it's going to happen, but it's possible," Hatzius stated.
December on the other hand has a higher chance for a rate increase.
"We got 40% for the December meeting, which basically means about a two-thirds probability that we'll see at least one hike by the end of the year," Hatzius continued. The economist noted that the Fed will have to consider the Brexit uncertainty still surrounding the global markets.
The U.S. economy added 287,000 jobs in June, according to the Labor Department. CNBC reported the average economist estimated 175,000 jobs would be added in June, while Bloomberg reported an expectation of 180,000 new hires.
In addition, the June unemployment rate increased by 4.9%, above economist expectations of a 4.8% rise and wages gained by 2.6% to 2 cents an hour, slightly lower than estimates of a 2.7% growth.
"I think the story from the economy is pretty clear: we're moving toward full employment, we're probably very close, and we are starting to see clearer signs of wage growth," Hatzius commented.
Shares of Goldman Sachs are higher by 2.19% to $150.22 this morning.
Separately, TheStreet Ratings rated Goldman Sachs as a "hold" with a score of C.
The primary factors that have impacted our rating are mixed. Among the primary strengths of the company is its expanding profit margins over time.
At the same time, however, TheStreet Ratings also finds weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.
You can view the full analysis from the report here: GS
TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.