WASHINGTON (Reuters) – US employers likely stepped up hiring in September and the jobless rate probably held at a six-year low, which could bolster bets on a Federal Reserve rate hike in mid-2015.
Economists polled by Reuters expect US non-farm payrolls rose by 215,000 last month, with the jobless rate staying at 6.1 per cent.
Hiring had faltered in August but a range of signs from robust retail sales to optimism among factory managers point to a level of economic vigor unseen since before the 2007-09 recession.
“What we see is a measured confidence. The business sector is now much more likely to hire even before there is a fall in their inventories,” said Patrick O’Keefe, an economist at CohnReznick and a former US Labor Department official.
The Labor Department will release its monthly employment report at 8.30am (1230 GMT) on Friday. The report regularly sets the tone for financial markets worldwide.
There have been some signs of cooler economic activity in September, but economists have parsed this as less-torrid growth rather than a significant slowdown. Growth in factory activity throttled back in September, for example, but the pace of expansion remains near a three-year high.
Most economists see the economy expanding at around a 3 per cent annual rate in the third quarter, well above the average over the last two years of 2.2 per cent.
But solid economic growth and hiring is insufficient for the Fed to initiate an early interest rate increase.
Several officials at the US central bank have expressed concern in recent weeks that inflation remains too low, a sign that a significant amount of slack remains in the economy. This raises the importance of the employment report’s wage gauges.