U.S. Added Just 12K Jobs in October, Far Short of 113K Expected

Just days ahead of the U.S. presidential election and Federal Reserve policy meeting, the government reported a marked weakening in the labor market last month, though it is unclear to what extent storms in the Southeast affected the data.

The U.S. added just 12,000 jobs in October, according to the Nonfarm Payrolls report, well shy of economist forecasts for 113,000. September’s job gain of 254,000 was revised down to 223,000. October’s unemployment rate was 4.1% versus 4.1% expected and 4.1% in September.

In addition to September’s downward revision, August’s originally reported 159,000 job gain was revised lower to 78,000.

Under pressure for the last day or so – perhaps thanks to the reduced chances of a victory next Tuesday for crypto-friendly Donald Trump – the price of bitcoin (BTC) was volatile, but still remaining in the $70,000 area in the minutes following the report. Bitcoin earlier in the week had rallied strongly, but was turned back from a challenge at a new record high above $73,700 on both Tuesday and Wednesday.

The Bureau of Labor Statistics added a note to the report saying it was not possible to quantify the effect of the recent storms on the payroll data.

Prior to Friday morning’s data, market participants were overwhelmingly expecting the Fed to trim its benchmark fed funds rate another 25 basis points at its policy meeting next week.

Checking other report details shows a bit more strength than the headline print. Average hourly earnings grew 0.4% in October, ahead of estimates for 0.3% and 0.3% in September. Average weekly hours of 34.3 were stronger than 34.2 expected and flat from the previous month.

In traditional markets, U.S. stock index futures continue to hold modest gains following the data. The 10-year Treasury yield has dipped four basis points to 4.25% and the U.S. dollar has edged down 0.1%. The price of gold continues near a record high at $2,767 per ounce.