The October employment report will be released today. Job growth slowed to just below 140,000 on average in September and August, which in our view is below the pace (>150,000) needed for the Fed to initiate the hiking cycle. We estimate that job growth increased to 170,000 in October and that the unemployment rate was steady.
The hourly earnings measure will be important as well. Wage inflation has been relatively subdued despite the impressive decline in the unemployment rate. This has raised doubt whether the unemployment rate is a good measure of the 'real' amount of slack in the labour market. If wage inflation starts to accelerate, it would be an important sign that the labour market has indeed become tight and would strengthen the case for a near-term Fed funds rate hike.
In the UK industrial production data are in focus but after the dovish message from the BoE yesterday the impact should be relatively small.
Budget balance figures in Sweden and manufacturing production in Norway, see Scandi Markets.
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