Citi: Upcoming Non-Farm Payrolls Report May Send More Conflicting Signals

On December 14, the Financial Times analyzed that the US non-farm payroll report to be released next Tuesday will include data for October and November, ultimately providing a more comprehensive picture of the US labor market for policymakers and investors, ending months of partial blind flying. After a highly divided meeting this week, the Federal Reserve lowered interest rates to a three-year low, with several officials dissenting, debating whether to prioritize combating high inflation or addressing the soft labor market. Citi economists pointed out that the upcoming employment report may send more conflicting signals. The bank expects October employment to decrease by about 45,000 jobs, but November to see an increase of 80,000. Citi economists stated that this rebound may be more related to seasonal adjustments rather than a “true improvement in worker demand.” They also forecast the unemployment rate to rise from 4.4% to 4.52%, while a Reuters survey of economists showed the unemployment rate at 4.4%. The Federal Reserve’s own quarterly forecast indicates a median unemployment rate of about 4.5% by the end of this year. (Jin10)