Important data stirs Fed rate cut outlook.
On December 16th, Beijing time, the U.S. Bureau of Labor Statistics released the non-farm payroll data for October and November at once, which showed that the U.S. unemployment rate unexpectedly rose to 4.6% in November, reaching the highest level since September 2021. Analysts say this could likely be a key factor prompting the Fed to cut rates further.
After the non-farm data was released, traders bet that the Fed would cut rates twice in 2026. According to CME's "FedWatch", the probability of the Fed cutting rates by 25 basis points in January next year once rose to 26.6%, up from 22% before the data was released. As a result, the U.S. dollar index plummeted, briefly falling below 98 for the first time since October 6. The three major U.S. stock indexes opened lower collectively, then experienced fluctuating divergence, with the Nasdaq rising back into the green and most large tech stocks closing higher.
According to the latest news, U.S. President Trump will interview another candidate for the Fed chair on Wednesday local time - Fed Governor Christopher Waller. Among all candidates considered for the Fed chair, Waller was rated as the top choice in a Wall Street Journal survey of economists conducted in October, and he received generally high evaluations on Wall Street. Important data released
Data released by the U.S. Bureau of Labor Statistics showed that the U.S. non-farm payrolls increased by 64,000 in November, higher than the expected 50,000; the U.S. unemployment rate unexpectedly rose to 4.6% in November, higher than the expected 4.5% and also above September's 4.4%, reaching a new high since 2021.
The report indicated that U.S. employment numbers for October decreased significantly by 105,000, a decline that clearly exceeded the market's expected reduction of 25,000. Due to the U.S. federal government "shutdown", which prevented the retrospective collection of data, the U.S. Bureau of Labor Statistics will not release the unemployment rate for October.
The U.S. Bureau of Labor Statistics stated that it cannot quantify the impact of the government "shutdown" on the non-farm employment data for October-November.
From the revised data, the U.S. job market is accelerating its "cooling". The non-farm payrolls for August were revised from -4,000 to -26,000; the non-farm payrolls for September were revised from 119,000 to 108,000. This means that the total downward revision of new jobs in the U.S. for August and September is 33,000.
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