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Oct 01 - 10:55 AM

BofA: What We Expect from the September Jobs Report And its Impact on the Fed November Decision

By eFXdata  —  Oct 01 - 10:00 AM

Synopsis:

BofA forecasts a 150k increase in nonfarm payrolls for September, following an August figure of 142k. The anticipated rise in public sector hiring is expected to contribute 20k, leading to a 130k increase in private payrolls, with stability in education and healthcare sectors.

Key Points:

  • The unemployment rate is projected to round down and remain unchanged at 4.2%, with the labor force participation rate likely dipping by a tenth to 62.6%.
  • Average hourly earnings (AHE) are expected to decrease by a tenth to 0.3% month-over-month, while average weekly hours are anticipated to hold steady at 34.3.

Conclusion:

A stronger-than-expected jobs report could shift market expectations toward a 25bp Fed cut in November, while a softer report may lead to increased pricing for more than 75bp of cuts by year-end. However, BofA does not believe the September jobs report will be a decisive factor for the Fed's November decision, as additional data, including inflation metrics and the October jobs report, will be available before the meeting.

Source:
BofA Global Research

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