Bank of America (BofA) economists adjusted their U.S. unemployment forecast, predicting the rate fell to 4.5% in December. BofA suggests the previous month's rate was overstated due to certain distortions.
Analysts also anticipate the labor force participation rate will slightly decrease. Crucially, BofA analysts believe an unemployment rate of 4.6% or lower will likely prompt the Federal Reserve to hold off on January interest rate cuts.
This commentary represents broader economic analysis and does not relate to BofA's financial performance or operations. The market showed no discernible reaction to the specific forecast.