In the December 4 week, Fed policymakers will be out of the public ear during the communications blackout period around the December 12-13 FOMC meeting. The blackout begins at midnight on Saturday, December 2 and runs through midnight on Thursday, December 14. While at this writing there is a solid chance that FOMC voters will opt to not raise the fed funds target rate again, the final decision could be swayed by the data in two reports for November – the Employment Situation at 8:30 ET on Friday, December 8 and the CPI at 8:30 ET on Tuesday, December 12.

Correctly interpreting the contents of the November employment report could be a bit tricky. The headline number for nonfarm payrolls is likely to be inflated by the return of 25,300 workers in the motor vehicle industry after the UAW strike with Ford, General Motors, and Stellantis was settled at the end of October, and 16,000 in the motion picture industry after the SAG-AFTRA strike was settled in early November. The November report on strike activity shows the net month-over-month change in the survey reference week for November – inclusive of Saturday the 18th – is down 37,600. At the present time 10,500 workers are on strike, which includes a new strike of 3,700 casino workers in Detroit started October 18 which should be visible in the leisure and hospitality sector. There remain continuing strikes of 1,700 by the United Steelworkers, 1,000 UAW workers at Blue Cross Blue Shield in Detroit, and 4,000 UAW workers at Mack Truck facilities. Depending on when these strike negotiations are done, the workers will come back on to payrolls, most probably in the December report.

Early estimates for the November change in nonfarm payrolls have a median of 180,000. If this is about right, it points to continued cooling in hiring, although consistent with an economy in modest expansion. Historically, the November headline number is only slightly likely to come in above the median expectation as it is to come in below.

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