Hana Securities "Fed Expected to Start Rate Cuts in June"

US January Nonfarm Payrolls Increase by 353,000
Exceeding Expectations and Previous Month

[Image source=Yonhap News]

Hana Securities announced on the 5th that it expects the U.S. Federal Reserve (Fed) to begin cutting interest rates in June.

Jeon Gyu-yeon, a researcher at Hana Securities, stated, "The increase in employment reduces the possibility of a slowdown in the U.S. economy, which is a welcome issue from the Fed's perspective."

The U.S. Department of Labor announced on the 2nd (local time) that nonfarm payrolls in the U.S. increased by 353,000 last month. This is twice the Wall Street forecast of 185,000 and a significant increase compared to the revised December employment figure of 333,000.

The unemployment rate remained at 3.7%, the same level as in December last year. The numbers indicate that the U.S. labor market continues to be overheated, which is expected to weaken early rate cut expectations by the Fed.

Researcher Jeon analyzed, "The strong employment was mainly due to wage increases in professional and business services and healthcare sectors," adding, "However, if high wage growth continues, the Fed will not gain greater confidence in easing inflation."

He further analyzed, "Expectations for early rate cuts will gradually disappear, and Hana Securities maintains its forecast for rate cuts to begin in June."

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