Hiring Surprisingly Surged In December | Global News Avenue

The job market was supposed to slow in December; instead, it stepped on the accelerator.

U.S. employers added 256,000 jobs in December, the Bureau of Labor Statistics said on Friday, up from a revised 212,000 jobs in November. It was the most jobs added in a single month since March and exceeded expectations of 155,000 forecasters, according to a survey of economists. Dow Jones Newswires and wall street journal. The unemployment rate fell to 4.1%, while the median forecast was unchanged at 4.2%.

Steady job growth is a double-edged sword for economic health. On the one hand, it reduces the likelihood that employers will be on the verge of a wave of layoffs because some experts warn. On the other hand, it means borrowing costs are likely to remain higher for longer, as the Fed has no reason to lower its benchmark interest rate to stimulate the economy with easy money, and Help the job market.

CIBC economist Ali Jaffrey wrote in a commentary: “The Fed has not paid much attention to the job market recently, and today’s reason gives them more reason to focus elsewhere.”

Investors have lowered expectations that the Federal Reserve will cut interest rates anytime in 2025. As of Friday morning, financial markets priced in a 28% chance that the Fed would not cut interest rates at all in 2025, up from nearly 14% the day before, according to CME Group’s FedWatch tool, which forecasts interest rate trends based on federal funds futures trading data. .