By Daniela Hathorn, senior market analyst at Capital.com
Today’s long-awaited Nonfarm Payrolls report finally delivered data covering both October and November, following delays from the government shutdown. The figures confirm that job growth remains modest and the labour market continues to slow, with 64,000 payrolls added in November after a dip in October, a clear deceleration from prior months. The unemployment rate rose slightly higher than expected at 4.6%, further softening from earlier in the year, and wage growth continues to ease modestly compared with previous months. All told, this is consistent with a labour market that is losing steam rather than overheating.
This softer jobs picture reinforces the view that the labour market is no barrier to further Fed easing. The Fed has already signalled patience after its recent rate cut and emphasised downside risks in employment. Futures markets are pricing in continued rate cuts in 2026, and a softer labour backdrop could bring some of those cuts forward if inflation also cools.
Alongside jobs, today’s retail sales numbers painted a mixed picture of US consumer demand. October saw no growth in retail sales, reflecting a slowing trend in consumer spending as households become more cautious late in the year. Earlier data (for September) showed only a small month-on-month rise in sales and more modest growth in core retail categories that feed directly into GDP calculations.
The data is supportive of risk appetite but the reaction in markets has been very mild. Equities continue to struggle to regain upside momentum as concerns about valuations and AI expectations continue to limit the bullish momentum. Meanwhile, the softer data continues to drag on yields and the US dollar.
