The United States created 119,000 jobs in September, a figure well above expectations despite a simultaneous rise in unemployment to 4.4 percent, which completely clouds the reading of the labor market.
Unpredictable Job Figures
The numbers arrive late, but the signal is brutal. The United States created 119,000 jobs in September, more than double the predictions, even as the unemployment rate climbs to 4.4 percent, its highest level in four years. A market that speeds up and falters at the same time is exactly the kind of mix that shakes Wall Street and complicates the task of the Federal Reserve ahead of its December decision.
The publication, delayed by six weeks due to the historic government shutdown, lands as the first true economic barometer in months. Immediate result: a country reviving in terms of hiring but a labor market simultaneously sending a cooling signal. For investors, the equation is now more opaque than ever.
A Divisive Report for the Fed
Job creation totally defies economists’ expectations, who were banking on fifty thousand new jobs. The contrast is even more striking compared to August, revised downward to a loss of four thousand jobs. Nevertheless, the rise in unemployment is enough to reignite the debate among Fed members.
Hawks versus Doves
The most cautious members will find in these robust hirings an argument to maintain rates. Those concerned about labor market fatigue will point to the rising unemployment rate. A scenario tailor-made to rekindle internal tensions at the FOMC, especially since the Fed has already lowered rates twice this year.
Markets no longer truly believe in a third easing in December. Futures pricing almost integrated zero probability of a decrease before the publication, and these figures do not change the outlook. Investors seek certainty, but they only receive a puzzle.
Immediate Impact on Markets
Immediately after the publication, bond yields slightly retreat, the dollar slips, and equity index futures contracts accelerate. The Nasdaq continues to benefit from the momentum created by Nvidia’s results, while the S&P 500 opens in the green. On the crypto side, Bitcoin remains around $9,100, slightly up, bolstered by the more relaxed market mood.
This cautious reaction reflects a simple realization: nobody knows yet how the Fed will interpret these data. The central bank views unemployment as one of the most reliable economic tension indicators. A movement of a tenth can sometimes completely redirect an entire monetary policy.
Continuously Reduced Visibility
The shutdown has left a gaping hole in statistical collection. No October report will be published, and fresh data will only arrive mid-December, just before the critical Fed meeting. In other words, monetary policymakers will have to make decisions with a partial view of reality. A situation that increases the risks of error, both for the Fed and the markets.
This September report thus becomes more than just a statistic. It is the only beacon still shining in a persistent economic fog, and its light is far from stable.
