The long-awaited December non-farm employment figures in the USA have been announced. The number was 216,000, compared to expectations of about 170,000.
The large increase in expectations also reduced the possibility of the Fed reducing interest rates in March. Interest rates in the swap market dropped to 50 percent in March.
As you may remember, Fed President Jerome Powell made statements about interest rate cuts at his last press conference, and then the market’s expectation for an interest rate cut in March rose to 80%. However, unemployment and non-agricultural employment statistics reduced this probability to 50% again.
In addition to non-farm employment, the US unemployment rate was also announced. Although the estimate was 3.8 percent, the announced rate was 3.7 percent.
Cooling of the Economy…
Since the rate hikes began, Fed Chairman Jerome Powell and industry leaders have repeatedly emphasized the need to calm the economy. However, these employment statistics and the decline in the unemployment rate contradicted expectations of an economic slowdown.
The Fed’s next interest rate decision will be announced on February 1.
