Wall Street's take on Non-farm payroll: Insufficient to influence the Fed's rate cut this month; inflation data next week will be the focus

Most Wall Street analysts said that the November jobs data was not enough to change the Federal Reserve's expectation of a rate cut this month, and that next week's inflation data may have a greater impact on the Fed as the labor market stabilizes. Analysts believe that the Fed will pause rate cuts early next year to observe the policies of the new US administration.

Data released by the US Bureau of Labor Statistics on Friday showed that the US added 227,000 non-farm jobs in November, exceeding the expected 220,000; however, the unemployment rate in November was 4.2%, exceeding analysts' expectations and the previous month's 4.1%. Most Wall Street analysts said that the November jobs data was not enough to change the Federal Reserve's expectation of a rate cut this month, and that next week's inflation data may have a greater impact on the Fed as the labor market stabilizes.

Brandywine Global portfolio manager Jack Mcintyre:

"The employment report has always been important to the market and the Fed, but the priority of economic data has shifted. Next week's inflation report will be more influential, as inflation is once again a key variable. The November jobs data met expectations, so it didn't significantly change the market's assessment of Fed policy in 2025. This paves the way for easing policy this month, but next week's CPI data could change that."

"We believe the Fed will shift to a more patient tone (which can be understood as slow and steady), as they are not under pressure to further increase the scale of monetary easing. The Fed's terminal rate will be as important as the path to achieving it."

Cherry Lane Investments partner Rick Meckler:

"The change of government and the upcoming new economic agenda have indeed overshadowed economic news."

"The end of the election removed some uncertainty that may have previously made businesses hesitant to add employees or make plans for 2025. However, an important factor is whether the new government will really save costs by significantly cutting federal jobs, and what impact this will have on future employment reports."

Harris Financial Group managing partner Jamie Cox:

"This data clears the way for the Fed to further lower policy interest rates in December—nothing in this jobs data supports pausing the normalization of monetary policy."

"The labor market has stabilized and is stronger than many pessimists would have people believe. A stable labor market supports a strong consumer economy, and the year-to-date data shows just that."

Laffer Tengler Investments fixed income head Bryon Anderson:

"There was indeed a rebound in overall employment after a month of hurricanes and worker strikes, along with positive revisions. The bigger trend is that hourly wages are still growing at a healthy pace, and the unemployment rate remains relatively stable, which gives us confidence in the overall economy."

"Markets react to short-term fluctuations in small data, but we still believe that the overall trend is stable enough to support the underlying job market. The divergence among US consumers is evident, with the top 20% of income and wealth earners accounting for a larger share, and they are still consuming, which supports the economy. While job growth may not be as strong as in previous years, we are not seeing a catastrophic job market."

Annex Wealth Management chief economist Brian Jacobsen:

"November's jobs data was a bigger-than-expected rebound, recovering from October's weak data. Wages are growing at a healthy but not excessive pace. Non-cyclical sectors such as healthcare and government remain the main drivers of job growth (8.810, -0.44, -4.76%), but even cyclical sectors are at least maintaining the status quo. Overall, there is no reason to worry about an imminent recession, nor is there any reason for the Fed to pause rate cuts."

Spartan Capital Securities chief market economist Peter Cardillo:

"Job creation was largely in line with market expectations, with a 36,000 upward revision (of October's data), possibly due to weather-related factors. Wages were slightly above expectations, but year-over-year they remained largely stable."

"These are basically good numbers, which continue to show that average non-farm job growth this year is between 205,000 and 210,000. This shows no signs of a recession. This report will not prevent the Fed from cutting interest rates by 25 basis points at the next FOMC meeting."

TD Securities head of US interest rate strategy Gennadiy Goldberg:

"The market is somewhat puzzled by this employment report. It wasn't as strong as some market rumors suggested; market expectations were around 220,000, so it was only slightly above expectations. The upward revision of 56,000 also doesn't seem to have convinced the market. Considering the volatility of the past few months, if smoothed out, the four-month trend is around 143,000, basically slightly below 150,000, and I think that's the actual trend."

"The rise in the unemployment rate certainly keeps the market on its toes, so I don't think this is a positive factor, but wage growth is strong. So, it's a somewhat noisy report, but I think it means the Fed can safely cut rates again in December and then possibly communicate a possible pause in rate cuts at the January meeting."

"Monthly job growth of around 150,000 is not a great economic performance, but it's not the sharp slowdown that everyone was expecting a few months ago."

Goldman Sachs Asset Management multi-sector investment head Lindsay Rosner:

"This morning's data was like a Thanksgiving buffet—job numbers were exactly as expected, the upward revision was positive, but the unemployment rate rose despite a decline in labor force participation. This report didn't spoil the holiday mood, and the Fed is still planning to cut rates in December."

Wells Fargo Investment Institute global investment strategy head Paul Christopher:

"This was a report that largely met expectations. What caught our attention was the rise in wages, which will help the economy stay strong into the new year. The market would have been looking for any signs of weakness."

"This likely confirms that the Fed will cut rates by another quarter point in December. The jobs data wasn't particularly strong, just about average."

"The economic situation is reasonable. As long as the labor market doesn't collapse, the Fed will closely monitor inflation. Inflation is currently quite stubborn, which is why we think there will only be two more rate cuts, including one after the December cut."

"For the future of the Fed, I think they will likely pause rate cuts early next year, at least pausing once in January. The Fed will want to see if the new administration's economic plan is fully implemented."