Summary
The US non-farm payrolls report for September 2024 revealed a significant increase of 254,000 jobs, far exceeding the expected 140,000. The unemployment rate dropped slightly to 4.1%, while average hourly earnings rose by 0.4% month-over-month, indicating a robust labor market.
This strong jobs report has led analysts to reconsider their expectations for the Federal Reserve’s monetary policy. Goldman Sachs, for instance, now anticipates a 25 basis point rate cut at the upcoming November meeting, rather than the previously speculated 50 basis point reduction. The report highlighted that the leisure and hospitality, healthcare, and government sectors accounted for a significant portion of job gains, with overall payroll growth showing a positive revision for previous months. The results suggest a resilient labor market, which could influence future economic policies and market reactions, particularly in the context of the USD’s strength against other currencies.
Key Highlights
- Job Growth: Non-farm payrolls increased by 254K, with previous months’ data also revised upward.
- Unemployment Rate: Fell to 4.1%, nearing a more favorable 4.0%.
- Average Hourly Earnings: Increased by 0.4% m/m, reflecting a year-over-year growth of 4.0%.
- Market Response: The strong report has led to a rise in the US dollar, particularly against the Japanese yen, indicating market confidence in the economic outlook.
Economic Implications
The September jobs report suggests a healthy labor market, which may reduce the likelihood of aggressive rate cuts by the Federal Reserve, despite prior market expectations. The composition of job creation, heavily weighted in certain sectors, points to ongoing economic recovery and stability.
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