Wall Street is locked in for a Fed rate cut next week: The only question is how far and how fast Powell will go

"Wall Street expects the Fed to cut rates by 0.25% next week, though some are speculating Jerome Powell could deliver a "jumbo" 0.5% move, given how weak recent labor market data has been. Global markets and U.S. S&P 500 futures rose on expectations of cheaper money, but there are still two more rounds of inflation data prior to the Fed's call."

"S&P 500 futures are up 0.25% this morning as investors, having digested grim data from the U.S. labour market last week, feel that a 0.25% cut in interest rates from The Fed is locked in. The talk now is whether U.S. Federal Reserve chairman Jerome Powell will surprise the markets with a "jumbo" 0.5% cut, or opt instead for a series of 0.25% cuts month by month."

"The reason investors are so sure the cuts are coming is that underneath the weak headline number from the nonfarm payroll jobs report-just 22,000 new jobs-was even weaker data from the private sector. Job growth was negative in sectors most exposed to President Trump's trade tariffs, according to Torsten Sløk of Apollo Management. The revised jobs number for June was negative."

Wall Street largely expects a 0.25% Federal Reserve rate cut next week, though some speculators assign a small chance to a 0.5% "jumbo" move. S&P 500 futures and global markets rose on forecasts of cheaper money while two more inflation reports remain before the Fed decision. CME Fed Funds futures show under 10% odds of a 0.5% cut. Forecasters differ on the path of easing, with Pantheon seeing three 0.25% cuts this year and Wedbush expecting two. Recent labor data showed only 22,000 nonfarm payrolls and weak private-sector hiring, especially in tariff-hit industries.

Read at Fortune