The toasty jobs number leaves the macro picture primarily intact.

Critics of the "soft landing" narrative may argue that the jobless rate is still "too low" to align with price stability. However, it's essential to note that pessimistic views tend to fluctuate based on incoming data. Earlier in the week, when the JOLTS report revealed a significant drop in job openings and ADP figures fell short, pessimists warned of a potential spike in the unemployment rate. Interestingly, some of these same critics have shifted their stance, suggesting that unemployment isn't high enough.

From a broader perspective, there are worse things than having a robust reading on job creation, especially when there is an expectation that inflation is still on course to moderate further. While Friday's labour market update was above consensus, no alarm bells were ringing to send the market scurrying for cover as it is unlikely officials will be overly concerned about the limited progress towards a 4 % unemployment rate, especially if the Consumer Price Index (CPI) doesn't overshoot expectations on Tuesday.

The current Fed policy stance is less urgent, given that core inflation is coming down the mountain quickly, and commodity price pressures remain subdued. With benign inflation dynamics, equities have some breathing room to wether minimal beats on jobs data.

SPI Asset Management provides forex, commodities, and global indices analysis, in a timely and accurate fashion on major economic trends, technical analysis, and worldwide events that impact different asset classes and investors.

Our publications are for general information purposes only. It is not investment advice or a solicitation to buy or sell securities.

Opinions are the authors — not necessarily SPI Asset Management its officers or directors. Leveraged trading is high risk and not suitable for all. Losses can exceed investments.

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