Enough Already

Today’s jobs number is the last piece of noise you’ll hear before the Fed hikes interest rates on December 16th for the first time in almost a decade.

WaPo:

U.S. companies in November continued their robust hiring, adding 211,000 new jobs, according to government data released Friday, providing a signal of economic health that will likely spur the Federal Reserve to raise interest rates later this month.

The unemployment rate held at 5 percent, a 7½-year low, even as more Americans began job searches in a sign of labor market confidence.

The new numbers released by the Department of Labor show a resilient U.S. economy that has been driven by consumer spending and job creation, even amid the turbulence of weak commodity prices and a strong dollar.

Policy Bears note that the Fed is hiking late in the cycle as economic data is actually weakening. Additionally, slack demand for commodities means there is not reason for the Fed to be in a rush to hike.

I would say the Fed wants “normalcy” and they’re probably just as tired of the Liftoff debate as you are (probably more tired of it).

Markets (bonds, currencies, stocks) are gyrating as the date draws near. Investors are growing accustomed to what is to come and moving things around in their portfolios. It is time.

Let’s move on to the next debate – what is the length of this hiking cycle and what will be the ultimate level for rates. The carousel continues.

 

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