US Job Growth Surpasses Expectations in December

The US economy demonstrated unexpected resilience in December with the addition of 256,000 new jobs, significantly surpassing economists' forecasts of 170,000. This surge in employment has led to a decline in stock markets, with the Dow Jones dropping 1.5% and the Nasdaq falling 1.8%, as investors recalibrate expectations for Federal Reserve rate cuts. Unemployment fell to 4.1%, its lowest since mid-2024, raising concerns that the Fed may adopt a slower approach to monetary easing. Consequently, Treasury yields rose sharply, with 10-year rates hitting over 4.78%, reflecting market apprehensions about prolonged interest rates. The strong job figures have bolstered the US dollar while contributing to a more cautious outlook among investors regarding future market volatility. Analysts suggest that while the economy remains robust, the path forward for monetary policy and market stability is fraught with uncertainty.