Soft Jobs Report Boosts Market Bets Fed Will Skip October Rate Increase, tell me about this news today

The US Labor Department released September employment data showing that hiring slowed down significantly more than economists anticipated:

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• Payroll Growth: US employers added only 29,000 jobs in September, falling well short of the roughly 90,000 jobs expected by forecasters. Payroll figures for August were also revised downward.

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• Unemployment Rate: The unemployment rate ticked up slightly to 4.2%, compared to 4.1% previously.

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Market Reaction and Fed Expectations

• October Meeting: Following the data release, interest-rate futures priced in less than a 20% (one-in-five) probability of an interest rate increase at the Federal Reserve’s October meeting, down from over 25% earlier.

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• Broader Outlook: While traders sharply scaled back expectations for action in October, markets still price in a significant likelihood (around 90%) of a rate hike at the December meeting if inflation pressures persist.

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In short, the cooling job market provides the Federal Reserve with substantial breathing room, prompting investors to bet that policymakers will pause and skip raising interest rates at their upcoming October policy meeting.

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