US jobs data on Friday will be a key factor in investors’ bets that the country’s labor market is cooling, clearing the way for interest rate cuts next year.
Nonfarm payrolls figures are expected to show US employers added 180,000 new jobs last month, up from 150,000 in October.
Any higher price would “challenge the market consensus” that interest rate cuts will begin early next year, said Julien Lafargue at Barclays Private Bank.
State Street’s Michael Metcalfe said last month’s data “was a game changer” for investors because it showed the labor market is cooling.
“Importantly, the November report shows that it was no fluke and that the labor market has in fact turned around. The market certainly thinks yes, but we need confirmation,” he said.
Traders are predicting up to five quarter-point interest rate cuts next year.