Bank of America U.S. economist Michelle Meyer weighed in on the disappointing nonfarm payrolls report on CNBC, saying that quantitative easing from the Federal Reserve is now inevitable.
With the underlying trend for job growth settled in around 125,000 by her estimates (when looking at overstatements in the winter), Meyer believes the Fed will have to act even as election nears this fall.
“I think that if the economy does what we think it will, which is continue to slow, reach about 1 per cent GDP growth by the fourth quarter, I think QE is inevitable. The Fed can’t sit idle,” Meyer said. “By the August 1st meeting or even September, the data could be weak enough that it does prompt Fed action despite the election.”
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