Ludovic Subran said July 3 payrolls looked weak beneath the surface, but AI, fiscal stimulus and energy could keep growth firm while the ECB likely stays on hold after last month’s “insurance” hike.
Allianz chief economist Ludovic Subran said on July 3 that underlying weakness in U.S. nonfarm payrolls may not be enough to cool price pressures, with inflation still expected to peak above 3.7%. He said support from AI, fiscal stimulus and the energy sector is helping sustain growth, a backdrop that could force the Federal Reserve to raise interest rates in September. In Europe, Subran said the ECB (European Central Bank) is unlikely to move again after last month’s “insurance” hike, suggesting a different policy path on the two sides of the Atlantic.