With The Fed huddling in The Eccles Building and traders hyper-focused on any signs of 'peak inflation' (because that means 'peak Fed tightness'), this morning's Q4 US employment costs index rose 1.0% QoQ (slightly cooler than the +1.1% expected and down from the +1.2% QoQ in Q3)...

Source: Bloomberg

Labor costs have risen at least 1% for six straight quarters, extending what was already a record streak in data back to 1996.

As a reminder, Fed Chair Powell explicitly mentioned this signal, and while the quarterly changes are trending in the right direction, we note that the YoY rate of change rose to a new record 5.07%.

Given the record rise in ECI YoY, we are not sure this is what The Fed wants to see...