Huatai Securities said the weaker-than-expected U.S. nonfarm payrolls report for September has reduced the urgency for the Federal Reserve to deliver another rate hike in the near term. The firm noted that monthly payroll figures can be volatile, and that the three-month average for payroll additions stood at 51,000, close to the level consistent with balanced employment. With the unemployment rate still low, the labor market remains relatively solid, though not especially tight. Huatai also said softer payroll growth and slower wage gains point to weaker real income growth in September, which could make it difficult for consumer spending to repeat August’s strong performance. Looking ahead, the NFIB hiring intentions indicator suggests October payrolls may still come in soft before rebounding later. Based on that view, Huatai Securities said the Fed is unlikely to raise rates again in October, while a further hike in December remains its base-case scenario. The note was cited by Jin10, according to Odaily.
Huatai Securities said a weaker-than-expected September U.S. nonfarm payrolls report has lowered the urgency for the Federal Reserve to keep raising rates in consecutive meetings.
The firm said monthly payroll data can swing sharply. On a three-month average basis, payroll additions came in at 51,000, a level it described as close to balanced employment. With the unemployment rate still low, the labor market appears steady, though not tight.
Huatai added that softer September payrolls, together with slower wage growth, led to a slowdown in real income growth for the month. Consumer spending may also struggle to maintain the strong showing seen in August.
Looking ahead, the NFIB hiring intentions indicator suggests October payrolls could remain soft, though payroll growth may recover afterward. On that basis, Huatai Securities said the Fed is unlikely to deliver another hike in October. In its base-case scenario, the next rate increase would come in December.
The note was cited by Jin10, according to Odaily.
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