Signs of Slowing Wage Inflation Boost Markets -- WSJ
By Alexander Osipovich
Markets rallied after this morning's jobs report (https://www.wsj.com/livecoverage/stock-market-news-today-01-06-2023-december-jobs-report-unemployment-rate) because it showed a slowdown in wage increases, analysts say, a sign that the Federal Reserve's battle against inflation may be having an impact.
Futures on the S&P 500 were recently up 0.9%, after being slightly negative for the day prior to the report's 8:30 a.m. ET release.
U.S. workers benefited from a resilient jobs market in 2022, but a robust increase in their pay raised fears of a so-called wage-price spiral. In such a scenario, employees demand greater pay hikes in response to climbing prices, and the influx of money into their pockets fuels further inflation. A downtick in wage hikes means such a scenario is less likely, easing pressure on the Fed to keep hiking interest rates.
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(END) Dow Jones Newswires
January 06, 2023 09:18 ET (14:18 GMT)
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