U.S. September Payrolls Disappoint as Markets Reprice Fed Path

Overview

• The U.S. economy added 29,000 payroll jobs in September and the unemployment rate rose to 4.2% on Friday, a result well below consensus forecasts.
• August payrolls were revised down to 133,000 and July was revised to a loss of 10,000 jobs, weakening the recent employment trend.
• Average hourly wages rose about 3% year‑on‑year, which trails inflation and means real wages have lost purchasing power for many workers.
• Markets reacted quickly with U.S. equity indices and bitcoin rising, Treasury yields falling and the dollar weakening as traders cut the probability of an additional Fed hike.
• Local political caution in Brazil produced volatility that at times offset global risk appetite, and analysts warned that Middle East tensions and energy or supply constraints could still push policy expectations back up.