The US unemployment rate is back to pre-GFC levels after the US created another 178,000 jobs and the participation rate fell. According to the US Bureau of Labor Statistics, the US unemployment rate fell from 4.9% to 4.6% as the number of jobs created in November was broadly in line with market expectations of 180,000, while the participation rate fell to 62.7%. US 10 year bond yields fell on the day and were down 6bps from 2.45% to 2.39%.
Average hourly earnings were lower than in October but they were still 2.5% higher than at the same time a year ago. NAB said the “0.1% fall in average hourly earnings…trumped the drop in the unemployment rate to a new post GFC low of 4.6%…” Westpac took a similar view. “The main surprise, however, was the fall in average hourly earnings of -0.1%, well below expectations at 0.2%…The annual rate is now at 2.5% vs 2.8% last month, leaving the overall trend for much of the year largely sideways. There is no change to expectations of a rate hike next week.”