The ADP employment report showed that 103,000 jobs were added in the private sector in November. This was below the consensus expectation for today’s report and also below the consensus expectation for Friday’s BLS report (headline: 187k, private: 160k). Rate markets priced for deep cuts in early 2024 may get a shock next week if the Federal Reserve reiterates that it will keep interest rates at their peak well into next year. Fed sentiment remains neutral, which we expect to be maintained, as consumer financial conditions aren’t tight.
Share Certificate issuances remain concentrated at the front end though the recent reprieve in longer term rates has spurred more activity further out the curve. The next two weeks before the Christmas and New Years holiday historically prove to be very busy for funding, we encourage any institutions that anticipate the need for liquidity to enter sooner than later as to avoid the congestion as we creep closer to year end.