US non-farm payrolls: The US added 228,000 new jobs in November ahead of crucial Fed meeting

 
Caitlin Morrison
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US non-farm payroll data was released today (Source: Getty)

The US added 228,000 new jobs in November.

The data comes ahead of an important Federal Reserve meeting, scheduled for next week, where it is expected to raise rates to their highest level in more than nine years.

The consensus expectation was for November non-farm payrolls to increase by 198,000, which would represent a significant fall from the prior month’s reading of 261,000.

"The market assigns a 90 per cent probability of the Fed hiking next week. Consequently, it’s unlikely that a poor payroll number would throw the central bank off track," said David Morrison, senior market strategist with GKFX.

"However, a disappointing jobs report together with lower-than-expected average hourly earnings (which would weigh on inflation) could see the Fed row back from its forecasts for a further three 25 basis point rate hikes throughout 2018. This should weigh on the dollar, although it may prove to be yet another excuse to buy US stocks indices, banking sector excluded.

"So, as always there are a lot of moving parts to consider with the likelihood of a pick-up in volatility after the release - in FX if not in equities. But what’s key is to look behind the headline numbers as revisions to prior data could see the initial market move fade rapidly."

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