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Investing.com – Report non-agricultural payroll Friday in November will be the focus this week as investors try to gauge whether the U.S. economy remains resilient in the face of rising interest rates. Oil prices are expected to remain volatile and central bank meetings in Australia and Canada could confirm the view that interest rates have peaked.

h2 1. Non-agricultural payrolls/h2

Markets will examine the November jobs report on Friday to see if economic growth continues to plateau.

Too high a number would weaken speculation that the Fed would begin easing its restrictive monetary policy sooner than expected, creating a headwind for rally stocks and bonds in the fourth quarter.

On the other hand, a weak reading could fuel fears of a slowdown in the economy after a 525 basis point rate hike, which could dampen risk appetite.

Economists expect the U.S. economy to add 180,000 jobs in November, after adding 150,000 jobs in October.

Separately, data released Tuesday is expected to show a moderate number of job vacancies in November, while Thursday’s initial jobless claims report will be monitored for any signs of an increase in the number of people out of work.

h2 2. Bring Santa Claus together?/h2

U.S. stocks rebounded and the S&P 500 closed at its highest level of the year on Friday, starting December on an optimistic note as investors became increasingly convinced that the Federal Reserve was done with interest rate hikes following comments from Fed Chairman Jerome Powell.

Powell pledged to act “cautiously” on interest rates, calling the risks of tightening too much “more balanced” with the risks of failing to control inflation.

Some investors currently see a strong chance that the Fed will cut interest rates as soon as March 2024, but markets have misread the Fed and the economy repeatedly in recent years and could do so again.

There will be no updates from Fed officials this week as the central bank enters a period Blackout traditional before the meeting on December 12 and 13.

h2 3. Oil Volatility/h2

Oil prices plunged more than 2% on Friday due to investor skepticism about the scale of OPEC+ supply cuts and concerns about weak global manufacturing activity.

Over the week, Brent was down around 2.1%, while WTI fell over 1.9%.

OPEC+ producers agreed on Thursday to withdraw around 2.2 million barrels per day (bpd) of oil from global markets in the first quarter of next year, the total including Saudi Arabia and the extension by Russia by 1.3 million b/d from current voluntary reductions.

OPEC+, which produces more than 40% of the world’s oil, cut production after prices fell from around $98 a barrel in late September amid concerns about the impact of slow economic growth on fuel demand.

These reductions are voluntary, so there is no collective revision of OPEC+ production targets. The voluntary nature of these reductions raises doubts about whether manufacturers will fully implement them and on what basis these reductions will be measured.

h2 4. Central bank decisions/h2

The Reserve Bank of Australia is expected to keep interest rates unchanged at its latest policy meeting on Tuesday, after giving it a rate hike last month and after last week’s data showed inflation had slowed down in October.

But investors are wary of attitudes warmongerwith prices still high and new governor Michele Bullock increasingly seen as someone more warmonger than its predecessor.

Elsewhere, the Bank of Canada is expected to keep interest rates unchanged at its third consecutive meeting on Wednesday. The latest data shows the country’s economy contracted in the third quarter, indicating that the central bank’s aggressive interest rate hikes are helping to dampen growth.

Investors could also get a new glimpse of when the Bank of Japan will begin its long-delayed tightening campaign thanks to Tokyo CPI data on Monday.

The Tankan business confidence survey and GDP data on Thursday will also shed light on whether businesses and the economy will be able to cope with a return of interest rate hikes.

h2 5. Eurozone data/h2

In the Eurozone, ECB President Christine Lagarde’s speech on Monday will be closely watched for further information on monetary policy ahead of the next ECB meeting on December 14.

The ECB pre-decision period begins on Thursday.

The bloc will release October industrial production figures for France and Spain on Tuesday, followed a day later by Germany and Italy.

Meanwhile, the data factory orders Germany will indicate on Wednesday whether the manufacturing sector of the bloc’s largest economy is still in decline.

–Reuters contributed to this report