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Nonfarm labor productivity in the United States rose at an annualized rate of 3.6% in the third quarter, exceeding economists’ expectations of 2.8%, following revised growth of 2.1% in the second quarter. Meanwhile, unit labor costs fell 0.7%, their first decline since the second quarter of 2025, contrary to forecasts for a 0.6% increase. The data reinforce the view that the labor market is not a source of inflationary pressure, while the Federal Reserve left interest rates unchanged at 3.75% to 4.00% last week.
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