US September Jobs Report Misses, Amid Fed Tapering Speculation

U.S. jobs rose by 194,000 in September, well below economists’ average estimate for a gain of 500,000 jobs, the Labor Department reported Friday.

But the data was mixed, with August’s jobs number revised upward by 131,000.

The combination may give the U.S. Federal Reserve more flexibility after Chair Jerome Powell signaled recently that the central bank looked to be on track to start tapering its $120 billion-a-month in bond purchases – a form of monetary stimulus – later this year.

“Overall, this looks like a ‘decent’ enough labor report to allow the Fed to proceed with the taper in November, as flagged at the last FOMC meeting,” Fitch Rating’s Chief Economist Brian Coulton said in an emailed statement, referring to the Federal Open Market Committee.

The concern among bitcoiners is that they would no longer be able to count on the Fed bringing more liquidity to the markets through quantitative easing (the policy of buying longer-term securities from the open market), which in the past has given investors the green light to keep putting money into riskier assets. The bitcoin price was holding steady after the report around $55,000.

“Powell made it clear we’re right on the edge,” said former Federal Reserve economist Claudia Sahm. A jobs gain of “200,000 or more will push [the Fed] to ‘further substantial progress,’” a phrase that Powell has used to describe the precondition for tapering.

The unemployment rate fell to 4.8% from 5.2% in August, according to the report.

The labor force participation rate – the percentage of the American population that is either working or actively looking for work – was down slightly to 61.6% from 61.7% in August.

The employment-to-population ratio, which measures the number of people employed against the total working-age population, ticked up to 58.7% from 58.5% in August.