A far stronger-than-expected September jobs report has tilted markets to price in fewer interest rate cuts from the Federal Reserve in 2024.
Following the report, markets were pricing in a roughly 10% chance the Fed cuts interest rates by half a percentage point in November, down from a 53% chance seen a week ago, per the CME FedWatch Tool.
Robert Sockin, Citi senior global economist, told Yahoo Finance that the better-than-expected jobs report makes it less likely the Fed moves with the "urgency" it did at its September meeting when the central bank cut interest rates by half a percentage point.
"This pushes the Fed out a lot," he said, adding that it's uncertain the Fed will make a 50-basis point cut again this year.
"Looking at the labour market strength evident in September’s employment report, the real debate at the Fed should be about whether to loosen monetary policy at all," Capital Economics chief North America economist Paul Ashworth wrote in a note to clients on Friday. "Any hopes of a [50 basis point] cut are long gone."