Introduction to This Week in Review
The economy and financial markets can be overwhelming and constantly changing. To help make sense of it all, Fisher Investments’ "This Week in Review" is a weekly segment that highlights a few key developments from the past week, what they mean for financial markets, and why they matter to investors.
Recent Economic Developments
This week, we’re covering three main topics: the latest US jobs data, ECB and BOE policy decisions, and US inflation.
US Jobs Data
The Bureau of Labor Statistics released its latest US jobs data, which showed a mixed picture. Non-farm payrolls fell by 105,000 jobs in October, but grew by 64,000 in November, ahead of expectations. Despite this rebound, headline unemployment ticked up slightly from 4.4% in September to 4.6% in November. However, this slight uptick shouldn’t be seen as a warning sign for the broader economy. The main unemployment rate rose because more people entered the workforce, and the number of people working part-time for economic reasons also increased.
Central Bank Rate Decisions
The European Central Bank and the Bank of England announced their latest monetary policy decisions. The European Central Bank left its policy rate unchanged, as the eurozone economy continued to expand at a moderate pace with inflation under control. The Bank of England, on the other hand, cut its policy rate to 3.75% as UK inflation eased to 3.2% in November. While this is challenging for households, it doesn’t reflect wider inflationary pressures, and prices are unlikely to start rising rapidly again.
US Inflation
The Bureau of Labor Statistics reported that year-over-year headline inflation decelerated to 2.7% in the US, below expectations. While some worry that this figure is too high, it’s a natural byproduct of economic growth and an expanding money supply. There’s little evidence that tariffs are reigniting high inflation levels, and current global money supply trends point to muted inflation ahead.
What This Means for Investors
For long-term investors, it’s essential to maintain a steady and disciplined approach to investing. Economic data will always have its ups and downs, but staying focused on long-term goals and strategy is what drives real success over time. Rather than focusing on short-term fluctuations in employment figures or inflation, investors should look at the broader picture and stay informed about market developments.
Conclusion
In conclusion, this week’s economic developments, including US jobs data, central bank rate decisions, and US inflation, provide valuable insights for investors. By understanding these developments and maintaining a long-term perspective, investors can make informed decisions and achieve their financial goals. For more insights and market analysis, visit FisherInvestments.com or subscribe to our YouTube channel.
