US Job Market Retreats

Following a robust Non-Farm Payroll (NFP) report last month, the anticipation was palpable as the market awaited another eagerly awaited report this Friday. However, it brought an unexpected twist in contrast to the previous upside surprise.

The jobs market took an unexpected turn, contracting from a revised 297,000 to 150,000, falling short of the 180,000 consensus. Additionally, the unemployment rate defied expectations by rising to 3.9%, surprising the market, which had anticipated a steady 3.8% figure.

The softness continued with the average hourly earnings, which shifted from 0.3% to 0.2% on a month-over-month basis. On a year-over-year scale, the figure slipped from 4.3% to 4.1%, though it remained slightly above the 4% forecast.

With these unexpected outcomes in the labour market, there could be significant implications on how the market perceives the Federal Reserve’s final interest rate decision for the year in December. The market’s sentiment may lean even further toward the possibility of a pause, reflecting the cooling trend in the labour market.

Sources: U.S. Bureau of Labour Statistics

Piece written by Tiaan van Aswegen, Trive Financial Market Analyst

Disclaimer: Trive South Africa (Pty) Ltd, Registration number 2005/011130/07, and an Authorised Financial Services Provider in terms of the Financial Advisory and Intermediary Services Act 2002 (FSP No. 27231). Any analysis/data/opinion contained herein are for informational purposes only and should not be considered advice or a recommendation to invest in any security. The content herein was created using proprietary strategies based on parameters that may include price, time, economic events, liquidity, risk, and macro and cyclical analysis. Securities involve a degree of risk and are volatile instruments. Market and economic conditions are subject to sudden change, which may have a material impact on the outcome of financial instruments and may not be suitable for all investors. When trading or investing in securities or alternative products, the value of the product can increase or decrease meaning your investment can increase or decrease in value. Past performance is not an indication of future performance. Trive South Africa (Pty) Ltd, and its employees assume no liability for any loss or damage (direct, indirect, consequential, or inconsequential) that may be suffered from using or relying on the information contained herein. Please consider the risks involved before you trade or invest.