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Softer US payrolls reduce pressure for an October Fed hike, ABN Amro says

ABN Amro pointed to September payrolls of 29k, versus a 90k consensus, plus prior month revisions totaling 60k lower.

Reported · Written up by our desk · Central Banks

ABN Amro economist Rogier Quaedvlieg said September US labour market data came in weaker than expected, with payrolls at 29k compared with a 90k consensus and prior months revised down by 60k, according to FXStreet.

In the note, Quaedvlieg described the report as mixed, saying the unemployment rate rose to 4.2% mainly because participation increased, while average hourly earnings rose 0.1% month over month, pulling the year over year rate to 3.0%.

He added that the three month average of 51k is solid given labour supply, but not indicative of a hot or tight market, and said the data, along with a prior downside surprise in the PCE report, removes pressure on the Fed to hike in October.

The FXStreet piece framed the softer labour figures as easing the risk of an October Fed rate increase, aligning with ABN Amro’s base case.

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