The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.
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.