November 1, 2019 / 12:58 PM / 9 months ago

Instant View: U.S. October payrolls growth slows less than expected

(Reuters) - U.S. job growth slowed less than expected in October as the drag from a strike at General Motors (GM.N) was offset by gains elsewhere, while hiring in the prior two months was stronger than previously estimated, offering assurance that consumers would continue to prop up the slowing economy for a while.


* U.S. Oct Nonfarm Payrolls +128,000 (Consensus +89,000) vs Sept +180,000 (Prev +136,000), Aug +219,000 (Prev +168,000)

* Oct Labor Force Participation Rate 63.3 Pct vs Sept 63.2 Pct (Prev 63.2 Pct)

* Oct Jobless Rate 3.6 Pct (Consensus 3.6 Pct) vs Sept 3.5 Pct (Prev 3.5 Pct)

* Oct Average Hrly Earnings All Private Workers +0.2 Pct (Cons +0.3 Pct) vs Sept Unchanged (Prev Unchanged) to $28.18 vs Sept $28.12; Oct Year-On-Year Earnings +3.0 Pct (Cons +3.0 Pct) vs Sept +3.0 Pct (Prev +2.9 Pct)

* Oct U-6 underemployment Rate 7.0 Pct vs Sept 6.9 Pct (Prev 6.9 Pct)

* Oct Private Sector Jobs +131,000 (Cons +80,000), vs Sept +167,000 (Prev +114,000)

* Oct Government Jobs -3,000 vs Sept +13,000 (Prev +22,000)

* Oct Factory Jobs -36,000 (Cons. -50,000) vs Sept -5,000 (Prev -2,000)


STOCKS: S&P e-mini futures ESv1 extend slight gain, last up 0.41%

BONDS: Treasury yields rise; 2-year US2YT=RR at 1.568% and 10-year US10YT=RR at 1.719%

FOREX: The dollar index .DXY rises, last up 0.08% at 97.42



“We weren’t going to see any downside from this number. The Fed has told us that the bogey man going forward is going to be inflation. Stronger growth isn’t going to bring back a more hawkish Fed or a tightening Fed or a Fed that is going to pivot off what they have just done.

“In the near term, you’re getting some data that should be able to allay some of the concerns that folks had with regards to the U.S. consumer in the last quarter of year. The numbers were better than expected, this bodes well for the broader economy. You probably will continue to see that value trade come into play with something like this, you probably will continue to see the yield curve steepen with something like this. Those are all positive things, those are all things that investors want to see. Low expectations but a strong number, and again, considering that we know that inflation is the bogey man, and nothing to be seen here.”


“This is really a blockbuster strong report, out of left field, much stronger on all fronts than expected particularly when you consider the GM strike, not only the 128,000 gain for the month but the upward revisions for the previous two months.”

“Private payroll job creation was stronger. Then you had no increase in unemployment despite the fact you had an increase in participation. There’s really across the board here a lot of strength.”

“This goes beyond the idea the economy is holding. It kind of suggests acceleration in the recovery ... the idea this is spread over three months does make it feel different.”

Americas Economics and Markets Desk; +1-646 223-6300

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