US jobs growth collapsed to 57,000 in June — what it means for UK investors

What does this mean for Fed rate expectations?

This is the most important question for UK investors with global portfolio exposure. In the minutes following the June NFP release, the probability of one or more Federal Reserve rate hikes by September fell from approximately 65% to 50%, according to CME FedWatch data (CoinDesk / CME, 2 July 2026).

Context is important here. The Fed had surprised markets with a hawkish stance at its most recent FOMC meeting, with new Fed Chair Kevin Warsh signalling that inflation — pushed up by the US-Iran conflict and AI-driven energy demand — remained a concern. The weak June jobs number shifts the balance: a Fed that was considering hiking rates now has reason to pause.

However, one data point doesn’t make a trend. The BLS noted that much of the June weakness reflects the normalisation of World Cup seasonal hiring rather than a structural deterioration. The next NFP report (due early August) and US CPI data will be crucial for confirming or reversing this picture.

For a primer on how inflation data affects markets, see IG’s guide to what CPI means for investors and traders.