The U.S. economy added 147,000 jobs in June, beating analyst expectations, the Bureau of Labor Statistics reported.

The pivot from rate hikes in 2022 and 2023 to rate cuts was widely forecast, and a big reason behind the S&P 500's epic 24% return in 2024. Most thought the Fed would continue to put its foot on the economic gas pedal, reducing rates in 2025, too.

New research from the Federal Reserve Banks of New York and San Francisco says markets put the odds of zero interest rates lower today than in the recent past, but economic uncertainty raises the potential for drastic cuts in the "medium to long term.