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November NFP gives Yellen green light for liftoff - Danske

FXStreet (Córdoba) - According to analysts from Danske Bank the November jobs report numbers should make the Federal Reserve more comfortable about rising rates in December.

Key Quotes:

“Today’s jobs report was the last key release ahead of the FOMC meeting on 15-16 December and should make the Fed feel comfortable about raising the Federal funds rate target for the first time since 2006.”

“Average hourly earnings declined from 2.5% in October to 2.3% in November in line with expectations. The annual growth rate in AHE is by nature volatile so the decline should, in our view, not be over-interpreted and it is worth noting that the trend has been upward this year. This is a sign that the Phillips curve is still functioning well. We expect wage growth to continue to trend up as we expect the labour market to tighten further.”

“As we expect wage inflation to increase this implies that underlying inflation pressure in the US is also increasing. This is the main reason we look for four hikes in 2016.”

“The number of marginally attached workers in November was the lowest since October 2008, indicating that the degree of slack in the labour market is diminishing quickly.”

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