Barclays on what the Federal Reserve will do next
We expect the Fed to leave the target range for the federal funds rate unchanged at 0.250.50% at its July meeting as it debates to what degree the softening in employment growth owes to transitory factors and the extent to which risks from abroad have diminished. Given competing views on the committee, the statement will have to strike a careful balance between acknowledging that June employment rebounded sharply and accommodative financial conditions following the UK vote against the desire to see further evidence that labor market momentum will keep the economy in an above-potential growth path.
