U.S. September Non-Farm Data Released: Job Growth Exceeds Expectations While Unemployment Rate Rises, Increasing Uncertainty in Federal Reserve Policy Path
The U.S. non-farm employment report released last night shows that non-farm employment increased by 119,000 in September, significantly higher than the market expectation of 53,000, indicating that the job market remains quite resilient.
However, the report also presents contradictory signals, with the unemployment rate rising to 4.4%, a four-year high; at the same time, wage growth has noticeably slowed, with an average hourly wage increase of only 0.1% month-on-month, marking the smallest increase this year.
The complexity of this report goes beyond this. Due to the previous U.S. government shutdown, the planned release schedule was disrupted, forcing the cancellation of the September employment report, making the October data a key basis for the market's assessment of the labor market situation. Therefore, the unconventional timing of this data release further complicates the judgment of the true state of the economy.
Faced with these conflicting signals, economists' divergence on the Federal Reserve's next actions is widening. On one hand, the robust growth in employment numbers indicates that the economy remains vibrant, supporting the maintenance of current restrictive policies; on the other hand, the rise in the unemployment rate and the slowdown in wage growth provide reasons to consider interest rate cuts. This “division” in the data puts the Federal Reserve in a more complex balancing act for its upcoming policy choices.
Market reactions also reflect this uncertainty. According to the latest futures market pricing, traders are becoming cautious about expectations for the Federal Reserve's December meeting, with the probability of maintaining interest rates unchanged significantly increasing. This wait-and-see attitude reflects that the market is waiting for more data confirmation, especially the upcoming inflation report, to form a clearer judgment on the timing of policy shifts.
Overall, the September non-farm data paints a picture of the U.S. labor market gently cooling but still remaining resilient. For the Federal Reserve, this report, which shows job growth exceeding expectations while also revealing a rising unemployment rate, presents new challenges for its policy-making, and it is expected that the Federal Reserve will maintain a cautious stance before obtaining more comprehensive economic data. $BTC
