US Job Growth Slows Sharply to 29,000 in September, Unemployment Rises
| Pair | Now | Since publish |
|---|---|---|
| EURUSD | — | — |
| USDJPY | — | — |
| GBPUSD | — | — |
- Sept US jobs added 29k, unemployment rises to 4.2%.
- Prior months revised down 60k; wages grow 3% YoY.
- Dollar Index drops below 102; Fed hike odds fall.
The U.S. labor market experienced a notable slowdown in September, with nonfarm payrolls increasing by just 29,000 jobs, significantly below economists’ expectations which ranged from 70,000 to 90,000. Concurrently, the unemployment rate edged up to 4.2% from 4.1% in the prior month, surpassing the 4.1% forecast. Adding to the weaker outlook, job figures for July and August were collectively revised down by 60,000, with August’s gain now reported as 133,000 from an initial 162,000, and July’s revised to a 10,000 loss. Wage growth also disappointed, with average hourly earnings rising 0.1% month-over-month and 3.0% year-over-year, both falling short of expectations.
New reports confirm US non-farm payrolls rose by 29,000 in September, significantly below consensus estimates of 85,000 to 90,000. The unemployment rate ticked up to 4.2% from 4.1%, partly due to a partial recovery in the labor force participation rate. Additionally, prior months’ payrolls saw downward revisions totaling 60,000, with August’s figure specifically revised down to 133,000 from an initial 162,000. Wage growth also came in softer than expected at 3% year-on-year, compared to a 3.1% consensus.
Following the weaker-than-expected jobs report, market sentiment shifted, leading to a decrease in the perceived likelihood of an October Fed rate hike. Traders now assign approximately a one-in-five chance of a rate increase on October 28. This outlook contributed to a decline in the two-year Treasury yield and saw the Dollar Index drop below 102.00.
Initial market reactions to the weaker-than-expected jobs report included gold gaining and a decline in US Treasury yields. However, reports on the Dollar’s performance were mixed, with some sources indicating it strengthened while others noted the Dollar Index dropped below 102.00.