Why Kevin Warsh Might Raise Interest Rates at the Next FOMC Meeting, Despite a Weak Jobs Report
Fed chair Kevin Warsh is focused on getting inflation to 2%.
Overview
July's job numbers came out last week, and they were well short of expectations. There were 23,000 jobs lost during the month, while economists had expected there to have been 80,000 jobs added. It's a huge miss, suggesting that the economy isn't in as strong a shape as many experts may believe. If the economy isn't doing well, the Federal Reserve may be more inclined to leave interest rates low, as they're often raised in order to slow inflation and to cool a hot economy down.
But while the latest job numbers may be concerning, that doesn't mean Fed chair Kevin Warsh won't announce an increase at the next Federal Open Market Committee (FOMC) meeting next month. Here's why there's still the possibility for rates to rise, and why that could be bad news for the S&P 500 (SNPINDEX: ^GSPC).
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Originally published at www.fool.com.