The U.S. labor market is back in the spotlight in the coming week with the U.S. nonfarm payrolls report on tap for a Friday morning release.
The jobs report for November, one of the most closely watched pieces of data for any month, will be under an even more intense spotlight as investors look for confirmation the Federal Reserve will pull the trigger on interest rates at their December meeting. Economists anticipate 180,000 jobs to have been added to the U.S. economy in November and for the unemployment rate to hold at 4.9%.
"Another healthy report reflecting job growth near its recent trend (175k-195k) will give the Fed added comfort to lift rates in December, though the bar for a rate move is low in our view and any print at or above the breakeven pace (roughly 100k) is likely sufficient," TD Securities analysts wrote in a note.
The U.S. economy added 161,000 jobs in October, 10,000 short of estimates but generally showcasing robust workforce trends. Average hourly earnings also rose to their highest since July, while year-over-year earnings increased to their best since 2009.
The labor market will be a running theme all week long. The ADP Employment Report for November, the unofficial reading on private payrolls ahead of the official U.S. jobs report, will be released Wednesday. Personal income and outlays for October will also be released on Wednesday, and weekly jobless claims are scheduled for their regular time on Thursday.
A December rate hike has a high probability among Wall Street pundits with any doubt after Donald Trump's recent election as U.S. president quickly evaporating. The chances of a December rate hike sit at 94%, according to CME Group fed funds futures.
The latest "Beige Book" from the central bank will provide insight into economic activity in the 12 Fed districts. The anecdotal reading on economic growth over a six-week period will be released on Wednesday afternoon.
A number of central bank officials are also set to make remarks, which will be closely watched for confirmation of a rate move in December. Fed Vice Chair Stanley Fischer will speak to the Clearing House annual conference in New York on Tuesday. New York Fed President William Dudley will make comments on economic growth in Puerto Rico on Tuesday morning.
On Wednesday, Dallas Fed President Robert Kaplan will discuss monetary policy in New York, Fed Board Gov. Jerome Powell will speak to the Brookings Institution in Washington, and Cleveland Fed President Loretta Mester will discuss the economic outlook in Pittsburgh. Mester and Fed Gov. Daniel Tarullo will make comments at the Financial Stability Conference in Washington on Thursday and Friday, respectively.
Also on the economic calendar in the coming week: The second estimate of third-quarter GDP, the Case-Shiller 20-city Index for September, and consumer confidence for November will be released on Tuesday; Chicago PMI for November, and pending home sales for October on Wednesday; and November motor vehicle sales, the ISM Manufacturing index for November and construction spending for October on Thursday.
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