November’s unemployment report showed progress in the labor market, with some caveats. The solid nonfarm payrolls gain of 178,000 just beat expectations, while the unemployment rate dropped to the lowest level in 9 years, 4.6% from the prior month’s 4.9%. Unfortunately, this decrease is largely attributable to a 0.1% drop in the participation rate (i.e., some unemployed people stopped looking for work). Another negative in the report is a 0.1% decline in average hourly earnings, which is the first negative reading of the year. On balance, however, the report adds to the likelihood that the Federal Reserve will raise interest rates later this month.

The third quarter GDP got a substantial bump this week, from a prior estimate of 2.9% to the current estimate of a 3.2% annualized rate. This makes it the fastest growing quarter in two years. The new estimate includes a hefty increase in personal consumption expenditures and a decrease in inventory growth, which is a positive sign for future production levels. The current forecast for GDP growth in 2017 is 2 to 2.5%, although the forecasting contains a high degree of uncertainty due to some of the drastic policy changes proposed by the President-elect.

Durable goods orders picked up in October, and the momentum apparently carried into November. The ISM Manufacturing Index, at 53.2, is up 1.3% and beat consensus expectations by 9 tenths of a percent. Growth in new orders increased, while export orders held steady. Production rose 1.4% and inventories and backlog orders showed little change. On the whole, the report was seen as favorable, if not as strong as other November indicators.