o, point out that employment gains were fairly broad-based across industries, including in cyclically-sensitive sectors like construction and manufacturing. They argue the labor market remains far too hot for the Fed's liking, and it will take much slower growth in employment and wages to return inflation to the central bank's 2% target on a sustained basis.“Nonfarm payrolls once again blew past expectations, increasing by 263K in November.
“Payroll growth of 263K is still too fast at this stage of the business cycle, and wage growth of ~5% is 1-1/2 percentage points above what would be consistent with the Fed's inflation target. A downshift to a 50 bps rate hike in December seems likely, but the Fed still has a ways to go in its tightening cycle.”Information on these pages contains forward-looking statements that involve risks and uncertainties.
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