US jobs data pushes easing taper away

THE LONG-awaited tapering of the US Federal Reserve’s quantitative easing (QE) programme is likely to be pushed back further, after the US jobs figures released yesterday failed to meet expectations.

The non-farm payrolls data for September, which was delayed by more than a fortnight by the shutdown of the federal government, shows that 148,000 jobs were created.

Analysts had expected around 180,000 jobs to be added.

Barclays Capital now expects that the Fed will push back its planned reduction in asset purchases to March next year, having previously expected the programme of tapering to begin in December.

Paul Ashworth of Capital Economics added: “Given the government shutdown, October’s payrolls are likely to be weak too. That means unless November’s gain turns out to be over 250,000, it now looks like the Fed could delay tapering until early next year.”

Despite the slower-than-predicted progress of job creation in the US, the unemployment level overall dropped from 7.3 to 7.2 per cent. At the beginning of 2013, the rate was 7.9 per cent.