The U.S. September nonfarm payrolls will be released tonight at 20:30. The market expects an increase of 84,000–90,000, with the unemployment rate staying at 4.1% and average hourly earnings rising 0.3% month-over-month. The 162,000 gain in August was about three times the expectation; this pullback is a return to normal rather than a sign of weakening.
My view: Don’t focus too much on the headline or the August comparison. Layoffs are already near multi-decade lows, and labor supply is being constrained by tighter immigration. With an extra 50,000 hires per month, the unemployment rate can be kept under control. So 80,000–100,000 job gains and an unchanged unemployment rate would only mean “still stable,” not enough to push back up the rate-hike probability for October, which has already fallen to about 25%.
The only developments that can truly change the pricing are at either end: payroll growth clearly exceeding 150,000 with hourly wages accelerating again, or a contraction where payrolls turn negative and the unemployment rate jumps above 4.3%. In the middle, the noise outweighs the signal. Inflation is still above 3%, so this employment report looks more like a validation check than a turning point.
$BTC
My view: Don’t focus too much on the headline or the August comparison. Layoffs are already near multi-decade lows, and labor supply is being constrained by tighter immigration. With an extra 50,000 hires per month, the unemployment rate can be kept under control. So 80,000–100,000 job gains and an unchanged unemployment rate would only mean “still stable,” not enough to push back up the rate-hike probability for October, which has already fallen to about 25%.
The only developments that can truly change the pricing are at either end: payroll growth clearly exceeding 150,000 with hourly wages accelerating again, or a contraction where payrolls turn negative and the unemployment rate jumps above 4.3%. In the middle, the noise outweighs the signal. Inflation is still above 3%, so this employment report looks more like a validation check than a turning point.
$BTC
