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US DATA: Strong Household Survey Behind Surprise U/E Rate Decline

US DATA
USGlobalEM BulletFixed Income BulletsData BulletBulletMarketsEmerging Market NewsForeign Exchange BulletsRegionNorth America
  • On the household survey, the unemployment rate was far lower than expected at 4.05% after 4.22% in Aug and 4.25% in July. It almost rounded down to 4.0%, vs consensus was 4.2 and with some analysts looking for 4.3.
  • It's a swift move away from the Fed's recently upward revised 4Q24 forecast of 4.4% (revised from 4.0% in its June SEP).
  • It came as employment surged 430k, it’s most since March after some softer months, easily outpacing the 150k increase in the labor force.
  • That saw the number of unemployed fall by 281k for its largest monthly decline since Mar 2022, and more encouragingly the only aspect that increased was those on temporary layoffs (+22k).
  • 16-19yr olds were the only group that saw higher u/e rates, +0.2pps to 14.3% to extend a sharp increase in Aug for their highest since early 2021.
  • The prime age (25-54) group on the other hand saw a 0.2pp decline to 3.4% for its lowest since May.
  • It was less of a surprise but the number working part-time for economic reasons also pulled back after two strong increases ,with -206k after two months averaging +305k. That helped the underemployment rate drop two tenths to 7.7% after those prior increases had helped it catch-up a lagged increase vs the standard unemployment rate.
  • The participation rate meanwhile was as expected, holding steady at 62.7% with conflicting forces as the 25-54 rate dropped a little further off multi-year highs (to 83.8% from 83.9 in Aug and 84.0 in Jul) but was offset by continued noise for 16-24 (bounced 0.7pts to 55.5% to fully reverse the prior dip).
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  • On the household survey, the unemployment rate was far lower than expected at 4.05% after 4.22% in Aug and 4.25% in July. It almost rounded down to 4.0%, vs consensus was 4.2 and with some analysts looking for 4.3.
  • It's a swift move away from the Fed's recently upward revised 4Q24 forecast of 4.4% (revised from 4.0% in its June SEP).
  • It came as employment surged 430k, it’s most since March after some softer months, easily outpacing the 150k increase in the labor force.
  • That saw the number of unemployed fall by 281k for its largest monthly decline since Mar 2022, and more encouragingly the only aspect that increased was those on temporary layoffs (+22k).
  • 16-19yr olds were the only group that saw higher u/e rates, +0.2pps to 14.3% to extend a sharp increase in Aug for their highest since early 2021.
  • The prime age (25-54) group on the other hand saw a 0.2pp decline to 3.4% for its lowest since May.
  • It was less of a surprise but the number working part-time for economic reasons also pulled back after two strong increases ,with -206k after two months averaging +305k. That helped the underemployment rate drop two tenths to 7.7% after those prior increases had helped it catch-up a lagged increase vs the standard unemployment rate.
  • The participation rate meanwhile was as expected, holding steady at 62.7% with conflicting forces as the 25-54 rate dropped a little further off multi-year highs (to 83.8% from 83.9 in Aug and 84.0 in Jul) but was offset by continued noise for 16-24 (bounced 0.7pts to 55.5% to fully reverse the prior dip).