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Employers added more than a quarter million jobs in December, well above forecasts, and the unemployment rate unexpectedly fell, supporting the Federal Reserve’s go-slow approach to further rate cuts
Underlying US inflation tamed by the close of 2024 riding on the back of a resilient job market and steadfast economy, according to the data released by the Government sources. .
The consumer price index excluding food and energy is seen rising 0.2% in December after four straight months of 0.3% increases. The core CPI, a better snapshot of underlying inflation, is forecast to have risen 3.3% from a year earlier — matching readings from the prior three months.
The annual figure suggests progress toward tamer inflation has essentially stalled, at a time when the labour market and demand show scant signs of distress. Employers added more than a quarter million jobs in December, well above forecasts, and the unemployment rate unexpectedly fell, according to government data released recently.
The jobs figures were followed by a consumer survey that showed a spike in long-term inflation expectations. Some 22% of those polled by the University of Michigan reported that buying big-ticket goods now would enable them to avoid future price hikes — a share that matches the largest since 1990.
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Economists at some of the biggest US banks pared their forecasts for more rate reductions after the jobs report. Fed officials in December indicated that they’d only lower their benchmark twice in 2025.
