The Economic Week Ahead: December 4 - 8

The Fed's blackout period has started. The Federal Open Mouth Committee will be silent until after the next FOMC meeting on December 12-13. This week's batch of economic indicators should convince them that the hot labor market is cooling, as they had hoped, without a recession. In addition, the week's inflation indicators should confirm that it is moderating, as they had hoped, again without a recession. So they are likely to do nothing for the third meeting in a row. (They should take the rest of the month off.) Both the stock and bond markets discounted our "immaculate disinflation" scenario during November. But the Santa Claus rallies in both should continue in December.

On the employment front, the week starts with October's JOLTS report (Tue). Comparable indicators suggest that job openings remained high around 9.5 million (chart).