The report landed just a day after the release of FOMC minutes pointing to a deeply divided committee, with policymakers split over whether the economy warrants another cut this year. That divergence was reinforced throughout the session:
- Fed Governor Michael Barr warned that inflation remains above target, arguing that the central bank should tread carefully before easing further.
- Cleveland Fed President Beth Hammack cautioned that cutting rates prematurely could prolong above-target inflation and heighten financial stability risks.
- Chicago Fed President Austan Goolsbee signaled discomfort with delivering another reduction in December, highlighting the need for clearer economic signals.
The combination of mixed labor data and hawkish leaning Fed rhetoric kept risk appetite subdued, with investors increasingly adopting a “sell the rally” stance heading into the final stretch of the year. For many, the ceiling for 2025 market performance may already be in place.
On the geopolitical front, developments also added a layer of uncertainty. Ukrainian President Volodymyr Zelenskiy agreed to advance work on a peace plan, while new US sanctions targeting two major Russian oil firms are set to take effect today a move that could inject fresh volatility into energy markets.
What Traders Should Watch Today:
With confidence in a December cut fading, markets are likely to remain sensitive to any Fed speak or data cues that shape expectations for early 2026 policy direction. The environment remains tactical and traders should stay nimble as year end positioning accelerates.
Disclaimer: This report is for informational purposes only. It does not constitute investment advice or represent the official views of any central bank or regulatory body.