The Jobs Report Is Good News for the Fed

Federal Reserve officials have been watching the job market closely, wary that it might be cracking under the pressure of high interest rates.The September employment report does a lot to alleviate those concerns.Companies hired at a rapid clip, the unemployment rate dipped and wage growth came in strong last month — a sign that the economy is holding up in the face of high borrowing costs.The report reversed recent signs of a labor market slowdown.

In doing so, it probably took away the argument for a big rate cut at the Fed’s next meeting, in early November.Fed policymakers lowered interest rates by half a point in September, an unusually large rate cut and their first in more than four years.Officials were reacting to slowing inflation and a recent cooling in the labor market.But Jerome H.

Powell, the Fed’s chair, has been clear that future rate cuts are likely to be more measured if the economy performs as expected.The Fed’s economic projections in September showed that officials expect to lower borrowing costs by another half a point before the end of the year, implying that they would make a quarter-point cut at each of their remaining two meetings.Officials had forecast that the job market would continue to slow slightly — with unemployment ticking up to 4.4 percent — before leveling off.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access.

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