Weekly Economic Update: January 8, 2024
• Yields increased over the week with the two-year Treasury note rising by fifteen basis points to 4.40% while the five-year note increased by seventeen basis points to 4.02%.
• The economy added a more than expected 216 thousand workers to payrolls in December as the labor market appeared to end the year on strong footing, however underlying details of the jobs report were not as supportive with large downward revisions to prior months and a large drop in participation.
• Average hourly earnings advanced by a robust 0.4% in December bringing the yearly gain to 4.1% which is too fast for a Fed hoping to see softer inflation readings however, wages for non-management workers, which make up most of the labor force, slowed to annual rate of 4.3% from 4.4%.
• Market participants will focus their attention this week on fresh inflation data with CPI due out Thursday where economists are expecting a small uptick in the headline figure and a slight moderation in core inflation.