08 December 2023
If you are covering the latest US employment data, please find below a comment from Richard Carter, head of fixed interest research at Quilter Cheviot:
“Once again the US economy continues to defy expectations despite tightening financial conditions meant to be doing the opposite. Job growth in the US exceeded market estimates, seeing 199,000 jobs added and the unemployment rate falling. While job growth is falling compared to last year, it is holding up remarkably well in the face of a tough economic picture and slowing growth globally.
“What this essentially does for the Federal Reserve is help to dampen down any talk of rate cuts in the first of half of 2024. It sees a path to consistent 2% inflation without having to cut rates, giving it the perfect scenario should the data turn sour at any moment. Stock markets are looking for any and every data point that might justify a cut in rates sooner rather than later, but the US economy is just not providing that.
“It should be noted that the full effects of the rate hikes have not yet been felt, so the picture could deteriorate from here, but for now the economic picture is looking strong in the US and that will leave the Fed heading into next year feeling just fine about the job it has done to date.”
