Non-farm strong? Wall Street still has doubts: there is expected to be a big adjustment in October, and the Fed may cut interest rates by 50 basis points in December.
Citigroup believes that seasonal adjustments may have magnified the September data, and it is the lower quit rate rather than strong hiring that is driving up the employment figures. The current trend of weakening labor demand in the United States has not been broken, and future employment data will undergo more drastic revisions, eventually prompting the Federal Reserve to cut rates by 50 basis points in December.
Non-farm payrolls greatly exceeded expectations, "no more interest rate cuts this year" enters Wall Street discussion.
After the non-farm payroll data was released, the expectation for the Federal Reserve's future interest rate cuts in the next four meetings is less than 100 basis points. Wall Street veteran Ed Yardeni believes that the Fed's monetary easing policy for the year may have already come to an end, considering the market's aggressive rate-cut pricing, any additional easing policy could increase the probability of a stock market crash.
The U.S. non-farm payroll data is too hot, Summers called the Fed's aggressive rate cut last month a mistake.
1. The CBOT's "Fed Watch" tool shows that after the report was released, the market expects a 99.1% chance of the Fed cutting interest rates by 25 basis points in November; 2. Former U.S. Treasury Secretary Summers posted that the Fed's "50 basis point rate cut in September" was a mistake.
September's strong non-farm employment pusher behind the scenes: Before the election, record seasonally adjusted and "civil servant" positions.
The seasonal adjustment amplitude in September has refreshed the highest record, while excluding the abnormal values after the outbreak of the new crown epidemic in June 2020. This is also the largest monthly increase for government workers on record.
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