Nonfarm Payrolls Swell

After posting notable gains in large part due to a weaker Euro, Germany’s industrial production slipped for the month of November, contracting at a -0.30% pace, printing well below the previous months’ figure and market expectations of 0.50%. Despite data showing factory orders rising by 1.50% during November, the drop was attributed to slowing emerging markets, causing headaches in planning future production. Factory producers fear that further declines are forthcoming especially considering the recent declines in China and weak outlook for global trade.  Energy and production jumped in November with values at 2.50% and 1.60% respectively. The jump though was countered however by 3.30% decline in capital goods while manufacturing output dropped -0.80%. The DAX 30 has struggled to rally after the weekly reopening following stark losses in the prior week.

Higher than anticipated job creation marked the end of 2015 according to the latest report from the US Bureau of Labor Statistics. Payrolls for December surged by 292,000, exceeding both November’s upward revised 252,000 jobs added and the consensus estimate of 200,000. Furthermore, the report highlighted that job openings were mostly on professional and business services, construction, health care, and food and drinking services whereas mining sector employment continued to decline. The unemployment rate remained steady at 5.00%, the lowest level since 2008. The US jobs market has proven robust despite concerns about emerging markets including China impacting the global economic outlook as commodity prices slide and financial markets tremble. The US Federal Reserve’s decision to lift interest rates in December was mostly based on the expectations that further tightening in the labor market will start to deliver higher wages and inflation.