Cooler-than-expected jobs data has bolstered belief amongst traders and analysts that the Fed’s hiking cycle may be complete, and the central bank could start cutting rates sooner than expected. This could ease concerns over deposit costs, loan growth, and credit quality for the banking industry.
However, the risks of further rate hikes remain as the Fed has left the door open for further action as officials work to bring inflation under 2%. Amid this uncertainty, waiting for better entry points in JPMorgan Chase & Co. (JPM) and Wells Fargo & Company (WFC) could be wise.
