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Yesterday saw the final piece in the jigsaw for the US economic outlook, with a whole raft of recent economic data only becoming relevant once we saw the result and reaction to the US election. The likeliness of a Fed hike shifted considerably overnight, at one point falling below 50%. However, with the recovery in risk assets highlighting a wider market confidence, the chances of a rate hike have improved considerably, now up to 82%.
The chart below highlights the improved fortunes of the US jobs market over the past year, with payrolls largely stabilising, into the range historically seen when seeing unemployment around the current levels. With that in mind, there appears to be little in the jobs market to hold the Fed back from raising rates.