US Job Growth Cools But Remains Healthy: Bloomberg
Sign up for Global Macro Playbook: Stay ahead of the curve on global macro trends.
US employers likely moderated hiring in December, concluding a year of steady job growth, according to a Bloomberg report. Economists surveyed by Bloomberg predict approximately 160,000 jobs were added, putting the average monthly job growth for 2024 near 180,000—a decline from previous years but still indicative of a robust labor market.
Despite the cooling trend, the Federal Reserve is unlikely to significantly alter its course of gradual interest-rate cuts, given the persistent strength of the economy and inflation's slow dissipation.
"The monthly jobs data on Friday are unlikely to alter the view of Federal Reserve officials that they can slow the pace of interest-rate cuts amid a durable economy and inflation that's dissipating only gradually," Bloomberg reports.
The report further states that the unemployment rate is projected to remain steady at 4.2%, while average hourly earnings growth is expected to cool slightly from the previous month. This suggests a labor market that is no longer fueling inflation.
A separate Labor Department report is expected to show minimal change in November job openings, with the number of vacancies approximately 1 million higher than at the end of 2019. The ratio of openings per unemployed person aligns with pre-pandemic levels.
"The consensus on Wall Street is that US economic exceptionalism will continue in 2025. Nonfarm payrolls will add fuel to such talk," state Bloomberg economists Anna Wong, Stuart Paul, Eliza Winger, Estelle Ou, and Chris G. Collins.
Several Federal Reserve officials, including Governors Lisa Cook and Christopher Waller, are scheduled to give public speeches this week, potentially offering further insights into the central bank's thinking.
Meanwhile, Canada is expected to release December jobs data following a jump in the unemployment rate to 6.8% the previous month. The merchandise trade report will shed light on whether Canada remains in a trade deficit, a point of contention for President-elect Donald Trump.
Globally, several major economies will release inflation data. China is likely to report near-deflation, while the eurozone is expected to see an uptick in inflation.