Federal Reserve policymakers on Friday got more reason to wait before raising interest rates again, as government data showed the labor market is cooling more than expected. US employers added just 29,000 jobs last month, the Labour Department reported, less than the 90,000 economists had expected.
August payroll gains were revised downward. The unemployment rate ticked up to 4.2 per cent, from 4.1 per cent.
The Fed raised short-term borrowing costs by a quarter of a percentage point last month to help get inflation back on track to 2 per cent.
Policymakers signalled they will likely deliver another rate hike by year’s end if the Iran war and other shocks that have pushed up inflation persist, as long as the labour market holds up.
After the data Friday, interest-rate futures contracts were priced for less than a one-in-five chance of a rate hike at the Fed’s October meeting, down from more than one-in-four previously.
Traders also eased bets on a December rate hike, though that’s still priced at a nearly 90 per cent probability.
