August 5, 2016 / 12:44 PM / 3 years ago

Traders boost bets on Fed rate hike after strong jobs report

Aug 5 (Reuters) - U.S. short-term interest rate futures fell on Friday after a government report showed U.S. employers added more jobs than expected last month, nudging up trader expectations that the Federal Reserve could soon lift interest rates.

Traders still see less than even odds of a rate hike this year, but are now pricing in close to even odds of a rate hike by early 2017. Before the report, traders saw little chance of a Fed rate hike until well into next year.

The price of futures contracts tied to the Fed’s benchmark policy rate moves inversely to the rate that traders expect at any given point in time. (Reporting by Ann Saphir; Editing by Jeffrey Benkoe)

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