Dawn Desjardins of RBC Capital Markets notes that the drop in non-farm payrolls in Oct was "broad based, with only government employment rising of the major industry categories." The data supports RBCCM's view that the US is already in recession. RBCCM looks for the US economy to continue to contract in Q4 and early Q1 2009, but then expects that the "combination of accommodative monetary policy and an anticipated narrowing in spreads" will be "sufficient to put growth back on an improving trend in the second half of 2009." If the financial market tone slowly improves, the Fed may be content to keep rates at a low 1.0% through 2009 "to ensure that the improving trend in growth is sustained," Desjardin says.