Published: 2024-01-31T13:47:03.000Z
U.S. Q4 Employment Cost Index - Slowing if not yet back to pre-pandemic pace
Senior Economist , North America
-
The Q4 Employment Cost Index with a 0.9% increase is weaker than expected and the slowest since Q2 2021, though still stronger than the pre-pandemic trend of around 0.7% per quarter. This will add to Fed confidence that inflation is losing momentum, even if the job is not yet done.
Slowing was seen in both components, a 0.9% rise in wages and salaries and a 0.7% rise in benefits both also the slowest since Q2 2021, and down from 1.2% and 0.9% respectively in Q3.
The yr/yr pace of 4.2% while down from 4.4% in Q3 is still well above the pre-pandemic trend that was consistently near (and usually below) 3.0%. However there has been a clear loss of momentum from the peak of 5.1% last seen in Q4 2022.
