Claims Data Completely Erases At Least One Day of Higher Rate Expectations

There have been been several days recently that have resulted in financial markets upping the odds for the Fed keeping rates higher for longer.  The most recent spike in those expectations followed yesterday's BOC (Bank of Canada) announcement--not because BOC policy has an impact on US rates, but due to the proof of concept for the Fed's upcoming meeting.  Perhaps it wouldn't be worth the Fed hiking instead of pausing, but could it be worth slightly different answers on the dot plot?  Some traders thought so.  Now Thursday's data shows the downside of economic headwinds.  Jobless Claims jumped to the highest levels since 2021.  The reaction erased the move seen after the BOC announcement, but end-of-year rate expectations remain elevated versus levels seen in early May.