Fed Hike Bets Lift Dollar After Strong US Jobs Data | Global Economy, Nov 9
A December Fed rate hike is about 77% priced by Polymarket after US employers added 165,000 jobs. What it means for oil, the dollar and Latin America. The post Fed Hike Bets Lift Dollar After Strong US Jobs Data | Global Economy, Nov 9 appeared first on The Rio Times .
The Federal Reserve had planned to conclude its series of interest rate hikes, but the strong US jobs data released on Friday has led to speculation that another increase could be scheduled for 8-9 December. The October jobs report showed a whopping 165,000 jobs added, far surpassing economists' expectations of 65,000. The unemployment rate stood at a low 4.1%, and hourly wages rose by 0.4%.
Such robust hiring provides the Fed with ample room to continue tightening monetary policy while price pressures remain high due to the Iran conflict. However, the market is divided between relief over the potential end of the war and concerns over the Fed possibly maintaining a tight stance. The upcoming US inflation data on Tuesday will be a key indicator.
A continued rate hike strategy keeps the dollar strong and borrowing costs high, exerting pressure on emerging markets, including Latin America. Despite the Fed's likely course, stocks rallied and oil prices dropped on Friday, creating a mixed picture. The Nasdaq fell 10.2% over the past 20 sessions, while the S&P 500 declined 5.6%.
The S&P 500 is currently 5.7% below its 6 October peak and 16.3% above its 12-month low. The mixed signals from the market indicate a tug-of-war between policy rates rising and equity relief.
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