US Jobs Report Bolsters Bets for a December Rate Hike

Expectations that the US Federal Reserve will raise interest rates in December have climbed to approximately 79%—up from 67% previously—following the release of job data that significantly outperformed expectations.

The US economy added 165,000 jobs, the unemployment rate fell to 4.1%, and wages grew by 0.4% on a monthly basis. These figures have reinforced expectations for continued monetary policy tightening; the strength of the labor market provides the Federal Reserve with greater latitude to focus on combating inflation, particularly as price pressures persist.

Markets are now looking ahead to the Federal Reserve meeting scheduled for December 9, with growing speculation—now at a very high level, as previously noted—that another interest rate hike is on the way.