U.S. economy expected to have added jobs at a slower pace in October
2023.11.03 08:17
© Reuters.
Investing.com — U.S. job growth is seen slowing sharply in October, possibly boosting expectations that the Federal Reserve may hold off on any further interest rate hikes this year.
Economists estimate that the closely-watched from the Labor Department’s Bureau of Labor Statistics will show that employers in the world’s largest economy added 180,000 jobs during the month, down from a bumper figure of 336,000 in September. The is also seen at 3.8%, matching the prior month, while are expected to have increased by 0.3% month-on-month in October, following a 0.2% gain in September.
Fed officials will likely be monitoring the job numbers carefully, as they may provide insight into whether the U.S. central bank’s unprecedented run of policy tightening is causing economic activity to cool.
Meanwhile, any signs of resilience in the jobs picture could fuel concerns over lingering inflationary pressures, potentially giving the Fed more headroom to roll out additional rate hikes.
Analysts at ING argued in a note that the consensus projection for October payrolls, while slowing, “would still be relatively robust — cooling, but making it hard to argue that the [labor] market is really troubled yet.”
Following a two-day meeting earlier this week, the Federal Open Market Committee voted to keep the key Fed funds rate steady at a target of 5.25% to 5.50%. This range, which stood at near zero in March last year, is at its highest level in more than two decades.
However, recent data has pointed to continued robustness in the U.S. economy. advanced at a faster-than-anticipated clip in the 12 months through September, while in the third quarter also outpaced estimates.
Speaking at a news conference on Wednesday following the decision, Fed Chair Jerome Powell left open the possibility for additional policy tightening, but stressed that officials will proceed carefully in response to a host of uncertainties facing the U.S. economy.
Markets are already widely betting that the Fed will choose to keep borrowing costs steady at its next meeting in December, with much of the debate now swirling around how long it will maintain rates at their current elevated levels.
