The US added 29,000 new jobs in September, below expectations for 84,000 jobs; the unemployment rate ticked up from 4.1 percent in August to 4.2 percent.
Even though the unemployment rate moved up, it remains at historic lows, indicating the labor market is holding its own. With employers hesitant to lay off employees, smaller level job gains tend to hold the unemployment rate steady. It was reported that the labor force participation rate moved up slightly last month.
This report was key in that it did not indicate a tightening labor market, which could add to inflationary pressure. The stability in the jobs report is giving the Fed the time it wants in order to assess how inflation is trending after last month’s rate increase. The consumer price index for September will be released October 14, and it will be that report that will likely determine the timing of the next rate increase. As it stands now, it is unlikely the Fed will raise rates at this month’s regularly scheduled meeting.