Nonfarm business sector labor productivity increased 0.8% in the third quarter (consensus +0.3%) versus the preliminary estimate of 0.3%. Unit labor costs, meanwhile, were up 2.4% versus the preliminary estimate of 3.5%.
The key takeaway from the report was the softer unit labor cost reading, which was deemed to be a supportive development for the peak inflation view. However, it bears pointing out that productivity is still weak in general, evidenced by the understanding that nonfarm business sector labor productivity decreased 1.3% from the same quarter a year ago.
Treasury yields took a noticeable turn lower following the release. The 2-yr note yield is down six basis points to 4.29% and the 10-yr note yield is down four basis points to 3.47%.