The January jobs report revealed a drop in the unemployment rate to 4%, accompanied by payroll gains of 143,000. A Fed interest rate cut in March is now very unlikely.

Traders of short-term interest-rate futures on Friday now expect the Federal Reserve to cut interest rates just one time this year, backing away from earlier bets on two rate cuts starting in June, after government data showed the labor market remains strong and a closely-watched survey showed a jump in consumers' inflation expectations.

Even inflation falling close to 2% in the coming months might not necessarily allow the Fed to cut rates soon, Logan said.

Federal Reserve Bank of Dallas President Lorie Logan said interest rates may already be near a neutral level, potentially obviating the need for further cuts even if inflation continues to cool.