nonfarm payrolls chart Oct 2023
nonfarm payrolls
  • Prior +336K (revised to 297K)
  • Two-month net revision -101K vs +119K prior
  • Unemployment rate 3.9% vs 3.8% expected
  • Prior unemployment rate 3.8%
  • Participation rate 62.7% vs 62.8% prior
  • U6 underemployment rate 7.2% vs 7.0% prior
  • Average hourly earnings +0.2% m/m vs +0.3% expected
  • Average hourly earnings +4.1% y/y vs +4.0% expected
  • Average weekly hours vs 34.4 expected
  • Change in private payrolls +99K vs +158K expected
  • Change in manufacturing payrolls -35K vs -10K expected
  • Household survey -348K vs +86K prior
  • Birth-death adjustment +412K vs -119K prior
  • Full report

The market was pricing in 79 bps in Fed cuts next year ahead of this report and the 2-year was trading at 4.98% while USD/JPY was at 150.14.

The details of this report are soft, particularly in the household survey. That's sparked another big bid in bonds with yields down 7 bps at the 2y tenor and 10 bps in 10s to 4.57%.

The dollar is much softer with USD/JPY down 60 pips since the release and similar moves elsewhere. A weak ISM services number later would give the market even more conviction that rate hikes are biting and the next move for the Fed will be lower. As it stands the Fed funds futures market is pricing in 89 bps in easing next year compared to 79 bps beforehand.