Fed expected to hold rates as US job growth slows
Federal Reserve policymakers have a fresh reason to hold off on raising interest rates again, after US government data released on Friday showed job gains slowing and the unemployment rate ticking higher. The figures were the last broad read of the US labour market before November elections that will decide whether President Donald Trump's Republican party retains control of both chambers of Congress.
US employers added 29,000 jobs last month, the Labour Department reported, against the 90,000 economists had expected. August payroll gains were revised downward, the September unemployment rate rose to 4.2 per cent from 4.1 per cent, and wage growth slowed.
A rising cost of living, with inflation elevated and borrowing costs higher, has left voters in a sour mood about the incumbents' handling of the economy, even though growth has been solid and the labour market has held fairly steady. The latest data suggest that picture may be changing.
The Fed raised short-term borrowing costs by a quarter of a percentage point last month, part of its effort to return inflation to its 2 per cent target. Policymakers have signalled they will likely deliver at least one more increase by the end of the year if the war with Iran and other shocks that have pushed inflation up persist, provided the labour market remains stable.
