The non-farm payrolls report from the US Department of Labor showed a increase in the unemployment rate to 3.7% last month from 3.5%, suggesting some easing of labor market conditions.
Rising unemployment could give the Fed cover for make a smaller rate hike next month.
The median hourly earnings increased 0.4% in Octoberagainst a forecast of 0.3%, while the nonfarm payrolls added 261,000 jobscompared to a forecast of 200,000 and after 263,000 in September.
The report was key for markets after comments from the Fed chairman, Jerome Powellthey had provoked on Wednesday fear that the central bank will increase borrowing costs for longer than expected.
“Powell should also be glad that the unemployment rate has risen from 3.6% to 3.7%. Every member of the Fed wants and expects unemployment to rise by at least one percentage point,” he said. Bryce Dotty, senior portfolio manager at Sit Fixed Income Advisors, speaking to Reuters.
Traders’ bets on a 75 basis point hike in December rose briefly to a 64.5% probability after the data release, but quickly fell back to around 60%.
The market attention will now turn to next week’s inflation dataas well as in the legislative elections on November 8in which control of the United States Congress is at stake.
The industry of Energy was one of those most earned in the S&P 500with a rise of 1.4%since the oil prices rose on prospects for an easing of Chinese COVID restrictions.