Chart of the Week – January 17, 2023

Despite concerns over the economy, recent payroll numbers have continued to come in better than expected. This week’s chart of the week looks at non-farm payroll numbers going to back 2000, and the number of sequential months that number exceeded estimates. As illustrated in the chart, recent readings have come in better than expect for a longer than normal period, suggesting that the labor market continues to have relatively strong momentum. While this implies the economy remains relatively strong, it also likely means that wages will continue to grow at an above average clip, and that the Fed may need to raise interest rates further to get the desired slowdown to quell inflationary pressures.