Out Friday strong data on US labor market increases the likelihood of the Fed raising interest rates at the December meeting. Let's try to understand what it portends for the US economy?
Thus, according to the number of jobs outside agriculture in November to a seasonally adjusted kolebaniyavyroslo 211 thousand. The data for October and September revised upwards. At the same time, the unemployment rate in November remained unchanged at around 5 percent, from which the conclusion is that the labor reserves of the country are growing. But, at the same time to achieve the target rate of inflation is not yet close.
Traders is almost certain that the Fed will raise rates at the next meeting, and that a further increase in rates will be slow.
But the situation with the US economy is not as smooth as the US GDP grows slowly. If you take the annual figures, it turns out that the data on the labor market are much better indicators of GDP, indicating how slowly increasing productivity in the labor market.
There is a strong probability that the subject of slow GDP growth, companies will increase the pace of hiring to support demand. Therefore, the unemployment rate will continue to decline, and at some point the Fed will reach the required wage growth.
With the growth of wages, increased buying activity. In addition, most companies will increase capital spending to stimulate productivity and further savings on staff.
Conclusion, the economy will strengthen in the future, but it's not bad. But at the same time, companies are trying to cope with rising costs, and many will continue to be difficult to achieve increased profits.
According to the materials WELTRADE