US Fed Has Room to Stay Patient on Rates, Nuveen Says

Nuveen's Laura Cooper says weaker July labour market data and cooling housing activity give the US Federal Reserve room to remain patient on interest rates, even as inflation concerns persist.

The $1.4 trillion asset manager's global investment strategist and head of macro credit pointed to these factors as evidence that financial conditions were already restrictive enough without further increases in policy rates.

The softer July payrolls report reduced the urgency for additional tightening and reinforced the view that policy remains restrictive, Cooper said.

The bond market is another source of constraint on the economy, with real yields rising even as policy rates have remained unchanged, she noted.