Asian shares subdued as jobs data raises odds of Fed rate hike

 Link to the article: https://www.reuters.com/markets/global-markets-wrapup-1-2023-04-10/

Asian shares inched higher as US latest job data implied a tight labour market, firming up expectations that the Fed will again raise interest rates next month.

Data from the Labor Department on Friday showed that nonfarm payrolls increased by 236,600, just a bit under 239,000 expected by the economists.

It also can be seen that even though wage gains have started to slow down, they are still too high to match the Fed's 2% inflation target.

While traders are convinced of rate cuts in the second half of the year by the Fed to prevent an economic downturn after the event of bank failures, some analysts see a disconnect between the Fed's path and the market's expectations. The disconnect is the consistently too-strong inflation, hovering at 6% compared to the 2% inflation target rate, which makes it quite unlikely that the Fed will cut rates.