Friday’s mixed stock market resulted from jobs statistics that far above forecasts, casting doubt on the likelihood of interest rate reduction by the Federal Reserve.
In December, the US economy added 216,000 jobs, substantially surpassing November’s record of 173,000 jobs added. This figure flew past predictions of 175,000 jobs. The 3.7% unemployment rate did not alter.
The economy might not be sufficiently cool for the Fed to ease monetary policy as quickly as the markets had hoped, according to the blockbuster figures.
The Fed’s return to 2% inflation will not be easy to achieve, according to today’s report, according to Andrew Patterson, senior international economist at Vanguard. Robust headline employment growth and pay growth above 4% in conjunction with Fed communications—including the minutes—that underscore the necessity of maintaining higher levels for longer declines
The news caused bond yields to spike. The benchmark 10-year Treasury yield increased to 4.05%, a five basis point gain.
As traders face challenges in the first week of the year, US equities are set to end a nine-week winning streak. This week, the Nasdaq is down 4% and the S&P 500 is down 2%.