Analyst: Nonfarm payrolls report cools market expectations for Fed to raise interest rates in October

Odaily Planet Daily News After the release of the U.S. non-farm payrolls report, market traders reduced their bets on the Federal Reserve raising interest rates in October. Swaps tied to the date of the Fed meeting show markets are no longer fully pricing in a full rate hike this year.

Allianz Chief Economic Advisor El-Erian said that the U.S. employment data came out and the results were surprising: only 29,000 new jobs were created in September, the unemployment rate rose to 4.2%, and hourly wages increased by only 0.1% month-on-month. Additionally, data for July and August were revised down by about 60,000 jobs. On the supply side, the labor force participation rate rose to 61.8%, a more positive development. Overall, this would further reinforce the impact of recent speeches by Fed officials that market expectations for a rate hike by the Fed in October are cooling.