The central bank will reveal its strategy Wednesday, September 18, following a two-day meeting. Fed chief Ben Bernanke will also hold a press conference after the announcement.
The August employment report “represents the last potential roadblock to the Federal Reserve’s plans to announce reduced bond purchases,” said David Kelly, chief global strategist at J.P. Morgan Funds, in a weekly outlook.
“Our models tell us that the economy may have added almost 200,000 jobs in August with the unemployment rate slipping to 7.3%,” he wrote. “However, in light of last week’s upward revision to second quarter GDP, a number of 150,000+ on payrolls and 7.4% on unemployment would probably be enough to keep the Fed on track to begin a wind down to QE, with an announcement likely coming in a press release and Bernanke news conference following the September 17th/18th FOMC meeting.”
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Max Chen contributed to this article.