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MNI BRIEF: US Labor Costs Increase 0.9%, Below Expectations

(MNI) WASHINGTON

Labor costs decelerate on a 12-month basis, bolstering hopes of soft landing.

The Employment Cost Index, the broadest measure of U.S. labor costs, rose 0.9% last quarter after gaining 1.1% in the July-September period, the Labor Department said on Wednesday. The 12-month rate fell to 4.2% from 4.3% in the previous quarter.

The ECI is widely viewed by policymakers and economists as one of the better measures of labor market slack and a predictor of core inflation. Fed Chair Jerome Powell and his colleagues are looking for deceleration in the employment cost index and for nominal wages to cool to around 3.5%.

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The Employment Cost Index, the broadest measure of U.S. labor costs, rose 0.9% last quarter after gaining 1.1% in the July-September period, the Labor Department said on Wednesday. The 12-month rate fell to 4.2% from 4.3% in the previous quarter.

The ECI is widely viewed by policymakers and economists as one of the better measures of labor market slack and a predictor of core inflation. Fed Chair Jerome Powell and his colleagues are looking for deceleration in the employment cost index and for nominal wages to cool to around 3.5%.

Keep reading...Show less