Mixed US labour market data, but the strong recovery remains intact – KBC


FXStreet (Barcelona) - The KBC Bank Research Team comments that the poor December US wage data were as a result of special factors and wage growth is expected to pick up later this year.

Key Quotes

“Since the December FOMC meeting the US labour market recovery continued unabatedly, confirming its recent trend. The unemployment rate is rapidly approaching the NAIRU rate, but wage growth remains the missing link.”

“We believe however that the poor December wage data were partly due to special factors and still hope to see wages picking up later in the year.”

“We believe that the poor wage data shouldn’t have a big impact on the Fed’s view regarding the labour market.”

“After providing a positive view on the economy in December, the Fed will probably strike a more balanced tone this month following lower inflation data and extra easing measures from several other central banks.”

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