🇺🇸 The U.S. economy added only 29,000 new jobs in September—compared to expectations of around 90,000. The unemployment rate rose from 4.1% to 4.2%.
On top of that, there were significant downward revisions:
July: from +21,000 to −10,000
August: from +162,000 to +133,000
Combined, this represents a shortfall of 60,000 jobs compared to the previous figures.
Wage growth is also slowing:
+0.1% month-over-month
+3.0% year-over-year—the slowest wage growth since May 2021
What does this mean for the stock market?
The Fed raised interest rates in September, and another rate hike was on the table for the meeting at the end of October. Following this data, the probability of an October rate hike is now priced in at only about 15%, down from 25% the previous day.
A weaker labor market and slower wage growth could ease inflationary pressures. However, the market is still largely pricing in a rate hike for December—the key factor will be whether the slowdown continues.
https://www.bls.gov/news.release/empsit.nr0.htm
https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html
