Through most of last week, investors seemed cautiously optimistic that the Fed would finally step in and start cutting interest rates by September – making the first of the three rate reductions it once estimated were in store for 2024. Reports released on job openings and private business payrolls had pointed to a shaky, if resilient, U.S. economy.

But by Friday, hopes for September relief, or relief at all this year, were in serious jeopardy after data from the Bureau of Labor Statistics that showed nonfarm payrolls rose by 272,000 jobs in May. Gold and silver prices plunged by 3.73% and 7.54%, respectively, on the new data.

The stellar labor report not only shattered Wall Street forecasts of around 185,000 jobs added, but it gave the Fed – which has been in no hurry to make changes until inflation is tamed – another reason to put the brakes on adjusting rates, which sit at a 23-year-high.

Traders will be closely watching Wednesday’s critical Federal Open Market Committee meeting for any clues from policymakers about when rate reductions might begin. It’s a foregone conclusion that rates will likely be left untouched this week by the Fed, as stubborn inflation and a squeezed labor market persist.

Adding to the anxiety, the Consumer Price Index (CPI) inflation report for May is also expected Wednesday, hours before the FOMC meeting. The results will no doubt inform federal officials’ rate-cutting roadmap for the rest of the year.

Analysts expect core inflation – which excludes food and energy – to have increased 0.3% in May.

If that figure holds, at least one rate increase could come later this year. If it goes any higher, those chances begin to evaporate.