Bets on June being the month in which the US Federal Reserve finally follows up its December 2015 25 basis points hike in interest rates faded at the end of last week following the release of the nonfarm payrolls data for April.

According to the Labor Department statistics, the economy created 160,000 jobs, short of consensus estimates for 202,000 and the lowest figure for 7 months. Last month’s 245,000 number was revised downwards slightly to 233,000 while the 5% unemployment rate remained unchanged.

There was some cause for cheer from a disappointing jobs report in the form of average hourly earnings rising by 8 cents or 0.3%. That took the year-on-year increase in average hourly wages to 2.5%, a number which could help push inflation towards the Fed’s 2% annual inflation target.

“Quite a few commentators still believe that the Fed will be more likely to hike if inflation ticks up but, in our opinion, that’s highly unlikely especially when the economy is producing such poor data elsewhere,” said Monica Freeman, chief markets strategist at Monex BMO Securities. “If next month’s report is another miss, we’ll be bold enough to suggest that rate hikes are pretty much off the table for the rest of the year.”

Freeman believes the jobs data gives Fed Chair, Janet Yellen the perfect reason to remain cautious and ‘data dependent’.

Monex BMO Securities has told clients to invest in assets that stand to gain from the continuation of low interest rates and higher inflation and warns that US stocks appear to be having difficulty pushing higher in the absence of fundamentals supporting the economy.

About Monex BMO Securities
Monex BMO Securities is a privately held, fully independent investment and wealth management leader, with retail operations based in Toronto, Canada and corporate trading division headquartered in Tokyo, Japan.

From our offices in Toronto the capital city of the province of Ontario and financial and business capital of Canada, we serve private individuals and families from N. America to Europe and with our corporate trading division strategically located in Tokyo, Japan, we have unrivalled access to Asia’s high yielding emerging markets, access to corporate resources, private equity and global mergers and acquisitions.