With the data released by the Labor Department last week showing better-than-expected employment growth from a resilient economy during November, concerns of wage increases driving prices higher are rising. This may cause the inflation the Fed is trying so hard to tame to go out of control.
As a result, albeit slowly, the Fed could be more determined to go further with interest rate hikes, leading to decreased discretionary expenditure by consumers, increased borrowing costs, and margin compression for businesses.
