US Non-Farm Payroll Data Crucial for Citibank and JPMorgan's Rate Cut Predictions

According to Odaily, the upcoming release of the US non-farm payroll data on Friday will be a significant test for Citibank and JPMorgan, who have boldly predicted a 50 basis point rate cut in September. For over a year, foreign exchange traders have not been this excited ahead of the US employment report. On the eve of the crucial non-farm payroll data release, options used to measure the dollar's exchange rate against major trading partners have reached their highest level since March 2023. Risk reversal data indicates a bearish sentiment towards the dollar. Since the weaker-than-expected July non-farm payroll data was released on August 2, Citibank and JPMorgan have been forecasting that the Federal Reserve will cut rates by 50 basis points in both September and November, and by 25 basis points in December. Interest rate swap contracts show that there is approximately a 35% chance of a significant 50 basis point rate cut at the Federal Reserve's September 17-18 meeting, although traders and economists believe a 25 basis point cut is more likely.