DBT Bureau
Bengaluru, 6 October 2024
Strong September job data has raised hopes of an imminent rate cut by the US Federal Reserve in the coming days.
According to the US Labour Department, nonfarm payrolls increased by 254,000 jobs in September from 159,000 in August. Similarly, unemployment rate fell to 4.1% from 4.2%.
Robust job data shows the resilience of the US economy. Many analysts feel that the economy is in a much better shape than most estimates and the world’s largest economy may not face a recessionary slowdown in the near future.
This provides the US Fed more elbow room to cut interest rates in the near future. There are two more FOMC meetings that are scheduled this year. One will happen in November, while the other one is scheduled for December.
Many analysts now feel that the US Fed may opt for a reduction in interest rates in these two meetings.
However, the US Fed chair, Jerome Powell recently said that “this is not a (policy-setting) committee that feels like it is in a hurry to cut rates quickly.”
Meanwhile, the US stock market has reacted positively to the encouraging September job roll data. Tech-heavy Nasdaq closed 1.22% at 18,137.85 on Friday, while Dow Jones Industrial Average rose 0.81%, to 42,352.75, and the S&P 500 gained 0.90%, to 5,751.07.
