In the roller coaster of sensations that employment has become in the United States, the official September report once again provides good data while pessimism had set in due to the notable deterioration of the figures. Last month they created 254,000 new non-agricultural jobs, well above the 150,000 expected. Separately, the August figure was revised from 142,000 to 159,000. The strength of this new report from the Department of Labor’s Bureau of Labor Statistics (BLS) is further supported by an unemployment rate of 4.1%, a tenth less compared to last month and expected. Despite the damage caused by sharp increases in interest rates following excessive inflation, the American economy appears to be resilient. In the eternal debate between a cooling typical of a normalization and a slowdown preceding a recession, the data published this Friday provide arguments for the first thesis. The defenders of a soft landing of the economy are winning this game and the possibility of a new “giant” rate cut of 50 basis points of the Federal Reserve in November after September running out of steam at the moment.
The catalyst par excellence for Wall Street at the start of each month, the employment report moved the markets. Traders have moved from a 68% chance of a 25 basis point Fed rate cut in November to a scenario of up to 88% chance to the detriment of the 50 denomination. This was noted in the price of dollarwhich increased by up to 0.5% in its exchange against the euro. In the fixed income market, the yield of two-year Treasury bondmost linked to the immediate trajectory of official interest rates, rose rapidly from 3.72% to 3.85%. Along the same lines, the 10-year bond goes from 3.87% to 3.96%.
ING warns that before the Fed presses the button on further budget cuts at the September 6-7 meeting, the BLS will release another employment report, the October one, which could change the photograph: “What is interesting is that the dockers’ strike Boeing and layoffs resulting from Hurricane Helene may affect the October payroll report. In fact, it might even be negative, depending in part on definitional issues and registration deadlines. But that’s for next month.”
For now, the rest of the employment data continues to oscillate between pessimism and tranquility, as we saw this week. At first the investigation was published SHOCKS August, which showed that the pace of hiring and firing continues to slow significantly (companies are hoarding labor due to existing economic uncertainty). On the other hand, the report of ADP The month of September with the creation of private jobs stood at 143,000 employees, well above the 125,000 expected. However, it is true that the ADP report has not shown much correspondence with that of the BLS recently.
Another piece of information usually closely observed also didn’t yield many clues. THE applications for unemployment benefits in the United States, released Thursday, amounted to 225,000 requests the previous week. This figure represents an increase of 7,000 from the previous week, but it is not far from the expected 221,000 and remains within a fairly constant range. Both countries’ employment indicators showed a worse outlook. Manufacturing ISM like that of services relating to the month of September. This leading indicator of private activity is also closely watched in the United States.
