(FT)
- September Job Additions: The US added 119,000 jobs, surpassing economist expectations of 50,000 and reversing August’s revised loss of 4,000 positions after downward adjustments to prior months.
- Unemployment Rate Increase: The rate climbed to 4.4 percent from 4.3 percent, marking the highest level since 2021 amid the first Bureau of Labor Statistics report following the government shutdown.
- Mixed Economic Signals: Strong hiring data supports Federal Reserve hawks favoring steady rates, while rising unemployment aids doves pushing for cuts to support the labor market.
- Fed Rate Decision Outlook: A December interest rate cut faces 50/50 odds, complicated by internal divisions between inflation risks and labor needs, with two 0.25 percentage point reductions already this year.
- Market Reactions: US Treasury yields and the dollar declined after the report, as stock futures rose, with the S&P 500 poised for a 1.6 percent opening gain.
- Survey Discrepancies: Unemployment figures derive from household surveys, contrasting with business surveys showing robust hiring, highlighting conflicting labor market indicators.
- Shutdown Impacts: The federal government shutdown delayed data collection, preventing an October jobs report and forcing inclusion of some data in November’s release, further clouding Fed deliberations.