Investors increase bets on interest rate cut from US Federal Reserve after jobs data
Investors have increased their bets on the Federal Reserve cutting interest rates this month after jobs data came in roughly in line with expectations.
Futures markets put an 89% chance on the Fed cutting rates by 25 basis points at its next meeting on 18 December after the payrolls data, compared to a 68% chance earlier in the session, Reuters reported.
Adam Hetts, global head of multi-asset at Janus Henderson Investors, said:
A strong November non-farm payrolls at 227,000 included some reversals from October and was further offset by a tick up in the unemployment rate to 4.24%. This big rebound from a distorted October read is actually quite balanced, should relieve some economic concerns, and keep the 18 December rate cut expectations on track.
Zooming out a bit from today, the trend of a slowly slowing labour market continues to sit in the sweet spot as far as rate cuts are concerned.
Samuel Tombs, chief US economist at Pantheon Macroeconomics, said:
November’s labor market data give the FOMC the green light to ease policy again this month.
With the cost of external finance for businesses still high, Indeed’s measure of job openings at a four-year low and catch-up growth in health and education payrolls now fizzling out, we expect monthly growth in payrolls to average about 100K in 2025, steering the FOMC to reduce the funds rate by 25bp at alternate meetings despite the risk of tariff-fuelled inflation.
That’s it from the business live blog this week. You can continue to follow our live coverage from around the world:
In our coverage of the Middle East crisis, thousands flee Homs in central Syria as rebel forces push on
In the US, Donald Trump defends Pete Hegseth as he announces more administration picks
In the UK, a minister declines to endorse Keir Starmer’s claim about civil servants being comfortable with ‘decline’
Thanks for reading, and please do join us next week. JJ
BAE Systems has signed contracts worth $2.5bn (£2bn) with Sweden and Denmark for new CV90 combat vehicles – with some to go to Ukraine.
Denmark will get 115 vehicles, while Sweden will buy 50. BAE, a member of the FTSE 100, said that the agreement also includes “further vehicles for Ukraine financed by the two governments”.
The vehicles are made in Sweden by BAE’s Hägglunds subsidiary.
Major general Peter Boysen, chief of the Royal Danish Army, said:
The infantry fighting vehicle is an essential component of the heavy brigade we are currently building. The 115 new vehicles will significantly enhance Denmark’s contribution to collective security and international operations. With the 44 existing vehicles, we will have a total of 159 vehicles, providing us with substantial strength – also from an international perspective.
