(Businesshala) – US employment grew much less than expected in September amid a drop in government payrolls, but hiring could rise in the coming months as COVID-19 infections ease and people resume looking for work let’s do it.
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Stock: S&P E-Mini futures dipped initially, but then recovered and were up 0.2%.
Bonds: The yield on the benchmark 10-year note dipped and was around 1.57%
Forex: Dollar index fell and was down 0.18% last
Rick Meckler, Partner, Cherry Lane Investments, New Vernon, New Jersey
“I think we’re in a strange place in terms of the market today. We have investor concerns about a rapid rate hike. And we have investor concerns about a very weak economy. You know that’s probably one of them. Only one thing is true.
“It has been true for the past few years that individual numbers, unless they are highly externalized, have no real impact on short-term policy. I think the Fed has decided that the best way to keep the markets stable is a Very well telegraphed and consistent policy.
“I think I’m optimistic about future growth. But I don’t think I’m surprised and I suspect the Fed is surprised that the current situation in recovering from the bottom of the pandemic is somewhat muted and this On point are less strong than you expected.”
Scott Anderson, Chief Economist, Bank of the West, San Francisco:
“I think it barely clears Powell’s hurdle of “decent.” I still think November’s taper announcement is still the most likely path forward for the Fed.
“FOMC taper timing should not swing to just one economic data point. The Fed will take into account a broad cross-section of data, including inflation, wage growth and labor shortage issues.”
Scott Brown, chief economist, Raymond James, ST. Petersburg, Florida
“Base price is disappointing relative to expectations, but it’s kind of a mixed bag. We had a softer gain in education, which showed up as a seasonally adjusted decline … There’s a lot of noise as it’s the start of the school year. And this will create some volatility in the numbers.
“Overall this is still in line with continued job growth overall. The Fed cites continued improvement in the labor market for the tapering. There was hope but it is still showing signs of improvement.
“Markets have a hard time really seeing beyond the headline number, but it’s a seasonally adjusted issue with education. It can still be a little frustrating, but it’s only a month. “
Peter Cardillo, Chief Market Economist, Spartan Capital Securities, New York
“These numbers are disappointing. The falling (labour market) participation rate explains why the unemployment rate fell. But the bottom line is that this is weak data.
“This is a depressing number and with it comes higher wage costs and it points to higher wage inflation down the road. It is unlikely to derail the Fed’s tapering off.”
(About the drop in government payrolls): “Maybe it’s because the government made vaccines mandatory, it’s possible that a lot of government employees lost because of that, but it’s a long shot.”
“The delta variant is a wild card and it turns out to be a hidden factor in employment data. We still have many people missing from the workforce, even as schools are open, and parents are returning to work. But it may be holding some people back from returning to the workforce. “
Sean Cruz, Senior Market Strategist at TD Ameritrade in Jersey City, New Jersey
“It seems that the bulk of that hit actually came from the government sector, the government lost 123,000 and the bulk of that was actually in education in local government. Outside of government. If you just look at education and health services, So there has been a decline in nursing, residential care facilities as well as education services. It was interesting to see where some of these drops were actually coming from, but if you look at some of the other areas, a little bit of construction There has been profit but not really much and there was a slight increase in the leisure and hospitality sector, but I don’t think that’s something to write home. So it’s a pretty soft report across the board.”
“I don’t know if this really puts the Fed in a very good place to have a clear path to go there and start tougher policy, at least the way this report is looking. Survey week is in early September and that’s where we were still having some major concerns with the Delta version.