2026-01-10 00:21:30

Non-farm payroll data reveals the true attitude of the Federal Reserve. In December, only 50,000 new jobs were added, a significant month-over-month decline of 76,000, marking the weakest performance since the pandemic. But this is not the most painful part—the unemployment rate actually dropped to 4.4%, a contradictory signal that has left the market completely confused.

Timiraos from the "New Federal Reserve News Agency" was very straightforward: this is paving the way for the Fed to pause in January. The market immediately responded, with the probability of rate cuts in January dropping to zero in the interest rate swap pricing. Traders have shifted their bets on the first rate cut from January to June. The two-year U.S. Treasury yield soared, and the entire market shifted into "wait-and-see mode."

Behind the data is an interesting contradiction. The total annual job growth was only 584,000, with private sector monthly gains averaging just 61,000—this is the weakest level since 2003. Yet, wage growth reached 3.8%, exceeding inflation expectations, making the labor market appear "seemingly ailing but actually holding up."

The key issue lies in human behavior. The decline in the unemployment rate is not mainly due to improved employment but because the labor force participation rate is decreasing—more and more people are "lying flat." Opinions among institutions vary; PGIM believes the Fed might "skip a" rate cut, while Natixis expects the pace of cuts to slow down.

The next variable is the March CPI data. Whether a rate cut can be achieved in June depends entirely on how inflation performs. The fate of the dollar hangs in the balance.

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MetaMuskRat

· 6h ago

Lying flat to rescue the market, this plot is amazing. What is the Federal Reserve playing at? It feels like the market has been played with. Did they cut interest rates only in June? Then what's the point of me playing around? The decline in the unemployment rate actually just means people are leaving. The data is misleading. Wait for the March CPI; that's the real game-changer, otherwise all efforts are in vain. The dollar now is like Schrödinger's currency—both strong and weak at the same time. Hiring only 60,000 per month? That's the level of 2003. This isn't a comeback; it's a step backward. A 3.8% salary increase that even exceeds inflation expectations? Who do you think you're fooling? The market is turning cautious. Traders are probably staring blankly at the gambling table. It looks critically ill but is actually just holding on. This description is perfect—it's a true reflection of the US labor market.

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SilentObserver

· 11h ago

Lying flat data is hard currency, the Federal Reserve is playing this move well Wait, unemployment rate drops but hiring is low, isn't that just everyone giving up? Rate cut in June? I bet this will be delayed Again, betting on CPI data to predict the dollar's direction, stimulation Is Timiraos this guy just a mouthpiece? Data contradictions are ridiculous, the market is really confused Wages still up 3.8%, the labor market is really incredible

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EyeOfTheTokenStorm

· 19h ago

Again with the "promised rate cuts, but ended up playing psychological games." From my quantitative model, this non-farm payroll data is completely a "fishing expedition" by Powell. The true reason for the unemployment rate dropping is that people are leaving, while hiring is in a death cross... What kind of labor market is this? Clearly a bubble. --- Honestly, only cutting rates in June? Traders are a bit too eager to change their bets. Comparing it to the 2003 recession cycle, it now looks like a "slow death" bottoming pattern. The surge in US Treasury yields is a risk warning right here. --- Wait, a 3.8% wage increase surpassing inflation expectations? Is this data real... The labor force participation rate is declining, and they still call it "hardly holding on"? I think this is the market fooling itself. Those jumping in should be careful not to get caught off guard. --- March CPI is the real variable now. All bets are hanging on this line. The mindset of T+ traders should probably shift to a wait-and-see mode. Don’t be fooled by the Federal Reserve’s tricks.

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SignatureLiquidator

· 19h ago

50,000 new additions are really incredible; this is the Federal Reserve playing smoke and mirrors. Lying flat is one thing, but the unemployment rate still stubbornly decreases—how does this logic add up? Did they cut interest rates only in June? Traders changed their bets pretty quickly this time, hilarious.

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WenMoon

· 19h ago

Are there more people lying flat, and the data looks better? That's a brilliant logic.

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OldLeekConfession

· 20h ago

Those who are lying flat are no longer working. Do they still have the nerve to show that the unemployment rate has decreased? This data is purely self-deception.

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