US Rate Hike Chances Plummet on Soft July Jobs Data

Financial markets have lowered their forecasts for a US rate hike in September following July's jobs data, which showed a decline in hiring and a modest drop in unemployment.

The Federal Reserve's interest rate target has been steady at between 3.5 percent and 3.75 percent since its last meeting, with three officials dissenting in favor of a rate hike.

Rate futures have now priced in just a 43.9 percent chance of Fed tightening in September, down from 57 percent before the jobs report. This has led some to speculate that the central bank may not raise rates after all.

However, Federal Reserve Bank of Richmond President Thomas Barkin defended the labor market's stability, saying it 'was very consistent with how I've been seeing the labor market, which is, it's not loose, it's not tight'.