US September non-farm payrolls +336K vs +170K expected

<ul><li><a href="https://www.forexlive.com/news/us-august-non-farm-payrolls-187k-vs-170k-expected-20230901/" target="_blank" rel="follow">Prior </a>+187K (revised to +227K)</li><li>Two-month net revision +119K vs -110K prior</li><li>Unemployment rate 3.8% vs 3.7% expected</li><li>Prior unemployment rate 3.8%</li><li>Participation rate 62.8% vs 62.8% prior</li><li>U6 underemployment rate 7.0% vs 7.1% prior</li><li>Average hourly earnings 0.2% m/m vs +0.3% expected</li><li>Average hourly earnings 4.2% y/y vs +4.3% expected</li><li>Average weekly hours 34.4 vs 34.4 expected</li><li>Change in private payrolls +263K vs +160K expected</li><li>Change in manufacturing payrolls +17K vs +5K expected</li><li>Household survey +86K vs +222K prior</li><li>Birth-death adjustment -119K vs +103K prior</li></ul><p>The odds of a November rate hike in the Fed funds market rose to 30% from 22% yesterday. Treasury yields are up 5-6 bps since the release and the US dollar has jumped. US 10s are now up to 4.84% and 30s are a shade below 5%.</p><p>The White House scheduling Biden for a victory lap after getting the pre-release was a dead giveaway that this would be a strong report, <a href="https://www.forexlive.com/news/is-bidens-appearance-a-tell-20231006/" target="_blank" rel="follow">just like I warned</a>.</p><p>As for the broader market, this is a problem as it validates the recent move up in Treasury yields and may push 10s to 5%. In turn, the rise at the long end is doing much of the Fed's work for it, which means they probably don't have to hike. However it also means the economy — particularly things like autos and housing — are particularly vulnerable to a slowdown next year.</p>

This article was written by Adam Button at www.forexlive.com.