Wall Street comments on non-farm payrolls: Insufficient to affect the Federal Reserve's interest rate cut this month, next week's inflation data will be the focus of attention

The U.S. Bureau of Labor Statistics released data on Friday showing that non-farm payrolls in the U.S. increased by 227,000 in November, exceeding the expected 220,000; however, the unemployment rate in November was 4.2%, surpassing analysts' expectations and last month's 4.1%. Most Wall Street analysts indicated that the employment data for November is insufficient to alter expectations for a rate cut by the Federal Reserve this month, and as the labor market stabilizes, next week's inflation data may have a greater impact on the Fed.

Brandywine Global Portfolio Manager Jack Mcintyre:

“The employment report has always been important for the market and the Fed, but the priority of economic data has shifted. Next week's inflation report will be more influential, as inflation has become a key variable again. The November employment data met expectations, so it did not significantly change the market's assessment of Fed policy for 2025. This paves the way for easing measures this month, but next week's CPI data could change that outcome.

“We believe the Fed will shift to a more patient tone (understood as slow and steady), as they are under no pressure to further increase monetary easing. The terminal rate of the Fed will be equally important as the path to achieving that goal.”

Cherry Lane Investments Partner Rick Meckler:

“The change in government and the upcoming new economic agenda have indeed overshadowed economic news.

“The end of the elections has removed some uncertainty that may have previously made businesses hesitant to hire more staff or make plans for 2025. However, an important factor is whether the new government will actually save costs by significantly cutting federal jobs, and what impact this will have on future employment reports.”

Harris Financial Group Managing Partner Jamie Cox:

“This data clears the way for the Fed to further lower policy rates in December—none of these employment data points support a pause in monetary policy normalization.

“The labor market has stabilized and is stronger than many pessimists believe. A stable labor market supports a strong consumer economy, and the data for the year reflects this.”

Laffer Tengler Investments Head of Fixed Income Bryon Anderson:

“After a month of hurricanes and worker strikes, overall employment numbers have indeed rebounded, along with positive revisions. The larger trend is that hourly wages continue to grow at a healthy pace, and the unemployment rate remains relatively stable, which gives us confidence in the overall economy.

“Markets may experience short-term fluctuations due to minor data, but we still believe the overall trend is stable enough to support a solid employment market. The divergence among American consumers is evident, with the top 20% in income and wealth holding a larger share, and they continue to spend, supporting the economy. While job growth may not be as strong as in previous years, we do not see a disaster in the job market.” Chief Economist Brian Jacobsen of Annex Wealth Management:

"The employment data for November is a larger rebound than expected, recovering from the weak data in October. Wages are growing at a healthy but not excessive pace. Non-cyclical sectors (such as healthcare and government) remain the main drivers of job growth, but even cyclical sectors are at least holding steady. Overall, there is no reason to worry about an imminent economic recession, nor is there any reason for the Federal Reserve to pause interest rate cuts."

Chief Market Economist Peter Cardillo of Spartan Capital Securities:

"Job creation basically met market expectations, with the October data revised up by 36,000, possibly due to weather-related factors. Wages were slightly above expectations but remained stable year-on-year.

"These are basically good numbers, continuing to indicate that average non-farm employment growth this year is between 205,000 and 210,000. This suggests no signs of recession. This report will not prevent the Federal Reserve from cutting rates by 25 basis points at the next FOMC meeting."

Head of U.S. Interest Rate Strategy Gennadiy Goldberg at TD Securities:

"The market is somewhat confused by this employment report. It is not as strong as some market rumors suggested, with market expectations around 220,000, so it is just slightly above expectations. The upward revision of 56,000 also seems not to convince the market, considering the volatility of the past few months; if smoothed out, the four-month trend is about 143,000, basically slightly below 150,000, which I think is the actual trend.

"The rise in the unemployment rate certainly keeps the market on alert, so I don't think this is a positive factor, but wage growth is strong. So, this is a somewhat noisy report, but I think it means the Federal Reserve can safely cut rates again in December and then possibly communicate a potential pause in rate cuts at the January meeting.

"Monthly job growth of around 150,000 is not an impressive economic performance, but it is also not the kind of sharp slowdown that everyone expected a few months ago."

Head of Multi-Sector Investment Lindsay Rosner at Goldman Sachs Asset Management:

"The data this morning is like a Thanksgiving buffet; the employment numbers are completely in line with expectations, and the upward revision is positive, but despite the decline in labor force participation, the unemployment rate has risen. This report does not spoil the festive atmosphere, and the Federal Reserve still plans to cut rates in December."

Global Investment Strategy Head Paul Christopher at Wells Fargo Investment Institute:

"This is a report that basically meets expectations. What catches our attention is the rise in wages, which will help the economy remain strong into the new year. The market would have looked for any signs of weakness.

"This may confirm that the Federal Reserve will cut rates by a quarter point in December. The employment data is not particularly strong, just in line with the average

"The economic situation is still acceptable. As long as the labor market does not collapse, the Federal Reserve will closely monitor inflation. Inflation is currently quite stubborn, which is why we believe there will only be two rate cuts in the future, including one after the December cut.

"Regarding the future of the Federal Reserve, I think the Fed may pause rate cuts early next year, at least pausing once in January. The Fed will want to see if the new government's economic plan is fully implemented."