Prior the US April jobs data, the Fed funds futures had been straddling the fence, with a roughly 50/50 chance of a hike/pause. The weaker than expected job growth resolves the dilemma and shifts the odds convincingly toward a pause. The Federal Reserve will signal to the market next week that it is prepared to pause, barring significant surprises in the next string of data.
As has been the pattern in recent months, the FOMC meeting and rate decision are largely non-events. The market remains confident of a 25 bp rate hike on Wednesday May 10. The uncertainty lies with the accompanying statement.