Perspective: Morning Commentary December 16

By: Arlan Suderman, Chief Commodities Economist

Tue, 16 Dec 2025, 14:21

Guest Commentary by Mike Castle

Lead Market Intelligence Project Manager

December 16 – The U.S. labor market is in the spotlight once again, with the Bureau of Labor Statistics playing catch-up and releasing both partial October and full November nonfarm payrolls data this morning. October saw net job losses of 105k, the worst print since December 2020, but rebounded to a gain of 64k in November, surpassing the average analyst estimate of 50k. Downward revisions were also made to August (now -26k versus -4k previously) and September (now +108k versus +119k previously), making the picture leading up to today look a bit worse. While we won’t get an official unemployment rate for October, November’s unemployment rate ticked up to 4.6%, well above market expectations of holding steady at 4.4% and marking the highest level seen since September 2021. Digging in a bit deeper, the U-6 unemployment rate (including discouraged and marginally attached workers, as well as those working part-time for economic reasons) climbed even further, now sitting at 8.7% versus the 8.0% seen in September, itself marking the worst reading seen since August 2021. The labor force participation rate ticked higher yet again, now at 62.5%, which is the highest level achieved since April.

Is bad news back to good news on Wall Street? Traders anticipate a more hawkish Fed in 2026 after seeing another 25-basis point rate cut last week, the third of 2025, with the next cut coming into today not expected until the FOMC’s April meeting—this morning’s jobs numbers have moved that up to March. Furthermore, only 50-basis points worth of cuts are being priced in by the end of 2026, per CME’s FedWatch tool. While there are lingering concerns of returning inflationary pressures, more focus is being placed on the health of the labor market, with Fed Chair Jerome Powell noting the labor market “seems to have significant downside risks” in his comments following the conclusion of last week's meeting. Traders may choose to interpret a worse than expected labor market as a dovish boost moving into the new year. Powell won’t be at the helm forever, however, with his term expiring in May. Look for the debate over Fed independence, and what a potential lack thereof could mean for the U.S. economy, to be a feature in the first half of 2026 as his replacement is named and expectations for monetary policy adjust.

Wage growth showed signs of moderation in this morning’s release as well, with November dropping to only 0.1% month-on-month, well below expectations of a 0.3% gain and representing the slowest monthly wage growth in the U.S. since August 2023. In year-on-year terms, wage growth rose by 3.5% in November, a notable slowdown from 3.7% in October and the weakest reading seen since May 2021. Again, if we choose to view this through the lens of how it will impact the Fed’s decision making, softer wage growth theoretically translates to less inflationary pressure, which again could provide a boost to the doves.

Headline retail sales were flat in October, missing expectations of holding steady with September’s 0.1% month-on-month growth and marking the worst print since May. As with the above soft labor data, this favors the case of the doves. In year-on-year terms, headline retail sales were up 3.5% in October, down from the 4.3% growth seen in September and also marking the worst print since May. Excluding gas and autos, however, retail sales rose by 0.5% month-on-month in October, up from a flat reading in September but holding roughly in line with the 0.6% monthly gain seen in August.

Stock futures are pointing to a stronger open following the above data releases, reflecting traders’ hopes of a more dovish Fed moving forward, while the VIX remains relatively muted as it hovers near the 16.7 level. The dollar is softening for the same reason, sinking below the 98 level for the first time since early October but rising to trade near 98.1 at the time of writing. Treasuries are roughly unchanged to slightly lower to start the day, with 10-year yields trading just above 4.18% and 2-year yields trading just below 3.50%. Crude oil is sharply lower to start the day, piling onto yesterday’s losses, with nearby WTI trading around $55.50, the lowest level seen in over seven months with global supply continuing to look ample, especially if the U.S. economy is showing signs of softening, and peace talks between Russia and Ukraine attempting to gain momentum following reports of the U.S. offering NATO-like security guarantees to Ukraine in an attempt to finally bring an end to the war. The ags are quietly mixed, with Chicago wheat leading the way down while soybeans try to cling to small gains.

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Perspective: Morning Commentary for August 4

August 4 – The benchmark Dow Jones Industrial Average surged into the close yesterday to finish almost 700 points higher, at a record close of 53,178 points – easily clearing the previous top from almost a month ago. The S&P 500 is on the brink of its own record as well, while the NASDAQ index is short of June highs but working on a strong three-session rally. All three are pointing to positive openings today. Palantir (a U.S. software company) reported better-than-expected earnings yesterday afternoon post-close to boost the tech sector, though a host of other firms reported strong earnings as well. The ten-year note continues to retreat from Friday’s high, now at 4.67%, with the dollar on the high side of level-par, while the VIX index now under 16 shows reduced volatility.

Matt ZellerTue, 04 Aug 2026, 12:43

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Perspective: Morning Commentary for August 3

August 3 – Equities futures are pointing higher to open the week and month, still in range of recent record highs and flush with optimism that the U.S. and others will start to negotiate with Iran over the Strait of Hormuz. A busy week is on tap with earnings reports and jobs data, among other economic releases. Crude oil is down over $5 per barrel and nearing in on three-week lows. The dollar is only slightly lower this morning but at its own month-and-a half low, while the U.S. ten-year note is also slightly on the low side at 4.68. The VIX index is rebounding a bit today after a sharp slide into the end of last week, just above 16.

Matt ZellerMon, 03 Aug 2026, 12:45

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Perspective: Mid-Day Commentary for July 31

July 31 – Stocks are clinging to modest gains at midday, with largely better than expected U.S. economic data today providing some optimism to end the week. The VIX briefly spiked to 18.7 earlier in the session but has since settled back to 17.15 at midday. The dollar has given back some of its gains on the day, now only modestly in the green, up roughly 0.1% to trade near 100.06 at the time of writing. Treasury action has been mixed thus far today, but yields remain notably elevated, with 30-year yields trading just below their 19-year high at 5.267%, 10-year yields just off their one-and-a-half-year high at 4.74%, and 2-year yields right at 4.30%. Crude oil remains quietly higher, with nearby WTI up 0.9% on the day near $84.70 and nearby Brent up 0.7% to trade near $87.40. The grains and oilseeds are widely lower at midday, with the wheat complex leading the way down, while the livestock sector is largely in the green.

Mike CastleFri, 31 Jul 2026, 16:33

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