Yesterday’s release of the Federal Open Market Committee (FOMC) meeting minutes indicated a Fed stance of maintaining elevated rates for an extended duration, with potential cuts in 2024. This news led to a decline in Asian markets session following the drop in US markets. The minutes portrayed a hawkish tone, suggesting prolonged restrictive rate levels, despite expectations for potential cuts. Attention will now turn to upcoming US jobs data on Friday.
Concerns around the labor market surfaced as US job openings decreased in November to their lowest levels since early 2021. The decline in voluntary quits and hiring added to signs of reduced labor demand. According to the Job Openings and Labor Turnover Survey (JOLTS) by the Bureau of Labor Statistics, vacancies dropped to 8.79 million from a revised 8.85 million in the previous month. Hiring also fell to its lowest point since April 2020.
Meanwhile, the ISM’s US manufacturing gauge remained stagnant in contraction territory for the 14th consecutive month at the close of 2023, primarily due to weakened orders, indicating ongoing challenges in the manufacturing sector.
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