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The US gained 661,000 jobs in September, weaker than expected, but the jobless rate fell to 7.9%. Stocks are set to fall as the sub 8% jobless rate lower the chances for fiscal stimulus, Yohay Elam an analyst at FXStreet, reports.

Key quotes

“Positive for COVID-19 – the new about President Donald Trump’s trumps everything, even the critical jobs report. Trump’s bombshell tweet about contracting coronavirus is sucking the energy in Washington and may scare elderly members of Congress from engaging in negotiations. Many of them are septuagenarians like the president.”

“September’s Nonfarm Payrolls add further depress the chances of a deal. Why? Politicians are mostly interested in the headline unemployment number, which dropped to 7.9% – below a round number and also better than estimated. That 7.9% figure masks the downbeat headline figure. America gained 661,000 positions last month, fewer than 850,000 expected, and only partially compensated by an upwards correction in August’s numbers.” 

“Overall, the report is somewhat disappointing but the headline unemployment rate compounds Trump’s illness and may further weigh on stocks. The safe-haven dollar has more room to gain in response to the publication.”