US rate futures see lower hike chances, higher odds of Fed pause

NEW YORK, May 8 (Reuters) - U.S. interest rate futures on Friday scaled back expectations for a rate hike by year-end and increased bets the Federal Reserve will stay on hold, after stronger-than-expected April job gains signaled continued resilience in the economy. The ⁠market now expects just an 18% chance of an interest rate increase at the Fed policy meeting in December, according to the CME's FedWatch. It was at roughly 23% late Thursday. At the same time, the chances of ⁠the Fed keeping rates steady rose to 74.1%, compared with 70.1% the day before. This move followed a government report ⁠that showed nonfarm payrolls increased by 115,000 jobs last month after an upwardly revised 185,000 ⁠advance in March. Economists polled by Reuters had forecast payrolls rising ⁠by 62,000 jobs after a previously reported 178,000 rebound in March. Reporting by Gertrude Chavez-Dreyfuss; Editing by Chizu Nomiyama Our Standards: The Thomson Reuters Trust Principles., opens new tab