(Reuters) - The U.S. Federal Reserve may find it hard to resist an “insurance cut” in interest rates this summer, Mohamed El-Erian, chief economic adviser at Allianz, said after the U.S. Labor Department issued a dismal payrolls report on Friday.
“The case for an interest rate ‘insurance cut’ this summer is building to a point that makes it hard for the Fed to resist,” El-Erian told Reuters.
“This weaker-than-expected jobs report, and notably so, will fuel concerns about what has been an impressively solid U.S. economy to date. This would also be a development that would increase the general headwinds facing the global economy.”
Reporting By Jennifer Ablan; Editing by Chizu Nomiyama