Non-Farm Payrolls Weak, Unemployment Rate Steady at 5.1%

Forget about an October rate hike and maybe forget about a December one too. The September employment report came in weaker than expected on all scores with nonfarm payroll at 142,000, well under the low estimate for 180,000. To seal the matter, downward revisions to the two prior months total 59,000. Average hourly earnings also came in below the low end estimate, at an unchanged reading and a year-on-year rate of 2.2 percent which is also unchanged. And the labor market is shrinking! The labor participation fell 2 tenths to a nearly 40 year low of 62.4 percent.

Recent History Of This Indicator:
Non-farm payrolls are expected to bounce back in September, to a moderate 203,000 from a subpar 173,000 in August. Large upward revisions are common for August, the result of adjustment timing for the beginning of the school year. The unemployment rate is expected to hold at 5.1 percent after dropping sharply in August. Wage pressures are not expected to accelerate with average hourly earnings seen rising only 0.2 percent. If the report comes in as expected, it would likely not build expectations for an October FOMC rate hike.