US economy added more jobs than expected in November

US job growth accelerated in November after being strongly hit by hurricanes and strikes at Boeing factories in October, but the impact was likely temporary and does not reflect a significant shift, with labor market continuing to ease steadily and keep the door open for another the Fed’s interest rate cut this month.  

US nonfarm payrolls rose by 227K in November following a sharp drop in October (initial 12K was upwardly revised to 36K) 

The same report showed unemployment rate climbed to 4.2% (in line with expectations) after holding at 4.1% for two straight months and average hourly earnings increased 0.4%, unchanged from October. Annualized figure showed wages rising at the same pace in November (4.0%). 

The Fed has lowered interest rates by 75 basis points since September, when it launched its easing cycle and brought the policy rate to the current 4.50%-4.75% range, from a multi-decade peak at 5.25%, hit after a campaign of sharp rate hikes during the March 2022 – July 2023 period.

Bets for another 25-basis points rate cut in December 17-18 policy meeting have risen above 70% on Friday.

Apart from a gradual ease in the labor market, the notion is also supported by the fact that the economy continues to expand at a healthy pace but partially countered by still elevated inflation and uncertainty about the policies of incoming Donald Trump’s administration, keeping the outlook on interest rates unclear.