Notes From the Desk – US Payrolls – A Dent In The Narrative
Over the last several weeks, we have seen bond yields plummeting lower on expectations that the Federal Reserve (Fed) would start cutting rates in early spring. Today’s employment data has put a dent in that narrative.
By the Numbers.
- 199k jobs were created in November (180k expected).
- Unemployment rate dips to 3.7% (3.9% expected)
- MoM hourly earnings accelerated from 0.2% in October to 0.4% in November (0.3% expected)
Implications.
The US labour market is gradually slowing, but likely not fast enough to open the door to rate cuts in the near term. But on the flip side, the data isn’t strong enough to warrant a hike next week.
Rates are modestly higher as investors push the timing of the first cut out a couple of months.
