ZINGER KEY POINTS
- The U.S. dollar rallied moments after the release of the November jobs report.
- A robust jobs report could call into question the Fed's ability to deliver a wave of rate cuts in the coming year.
The pace of employment growth beat economist expectations to the upside in November, indicating a more pronounced strength in the U.S. labor market than initially projected.
Non-farm payrolls (NFPs) grew by 199,000 in November, an increase from the 150,000 reported in October and above the expected 180,000, according to Friday’s Bureau of Labor Statistics report.
This latest jobs report could potentially jeopardize aggressive market bets on a wave of Federal Reserve interest rate cuts in 2024 that are driven by concerns about an economic slowdown.
November Jobs Report: Key Highlights
- In addition to the NFP data, the jobs report also noted a shaper-than-expected decline in the unemployment rate, from 3.9% to 3.7%.
- Annual wage growth remained steady, with average hourly earnings flat at 4% compared to November 2022, aligning with expectations.
- On a monthly basis, average hourly earnings increased by 0.4%, accelerating compared to October’s 0.2% and beating the expected 0.3%.
Market Reactions
Moments after the release of the November jobs report, the U.S. dollar, as tracked by the Invesco DB USD Index Bullish Fund ETF, rallied, reflecting a growing market fears that a robust jobs report could call into question the Fed’s ability to deliver a wave of rate cuts in the coming year.
Equity futures were on the decline one hour before the opening of the Wall Street trading session, with the Nasdaq 100 down 0.7%.
Technology stocks, as tracked by the Invesco QQQ Trust closed 1.4% higher on Thursday, driven by a widespread rally in AI-related stocks. A positive close on Friday would mark the sixth consecutive positive week, marking the longest streak since June.
—
Originally Posted December 8, 2023 – November Jobs Report Outruns Expectations, Unemployment Drops, Jeopardizing Rate Cut Bets
Disclosure: Benzinga
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Disclosure: Interactive Brokers
Information posted on IBKR Campus that is provided by third-parties does NOT constitute a recommendation that you should contract for the services of that third party. Third-party participants who contribute to IBKR Campus are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.
This material is from Benzinga and is being posted with its permission. The views expressed in this material are solely those of the author and/or Benzinga and Interactive Brokers is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to buy or sell any security. It should not be construed as research or investment advice or a recommendation to buy, sell or hold any security or commodity. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.
Join The Conversation
If you have a general question, it may already be covered in our FAQs. If you have an account-specific question or concern, please reach out to Client Services.