We've finally seen a nonfarm payrolls (NFP) print after weeks of waiting. Delayed by the shutdown, the newest data shows weak job additions in September, with 148,000 jobs created. Consensus forecasts suggested that we'd see 180,000 jobs added.
The unemployment rate falls from 7.3 to 7.2 per cent (the lowest since November 2008), with average hourly earnings increasing by 0.1 per cent (against expectations of a 0.2 per cent rise).
August's NFP number has seen big upwards revisions from 169,000 to 193,000. July's drop from 104,000 to 89,000 after revisions.
The dollar has dropped against the euro to November 2011 lows on that jobs miss:
Sadly the temporary US government shutdown has taken some of the sparkle from jobs release day.
The prolonged shutdown will certainly have hit fourth quarter GDP, and the Federal Reserve will want to offset that drop in aggregate demand with a longer period of monetary easing. Ishaq Siddiqi, market strategist at ETX Capital, says that "expectations for tapering are now moving to mid-2014".
That puts eventual tapering of quantitative easing further off into the future, making these data prints less critical. But Siddiqi does highlight that some still believe we could see tapering as early as December, "if data supports the case".
Now that we've seen the weaker data come in Owen Callan, fixed income dealer at Danske Bank Markets, has asked that "the last person expecting a December taper please turn out the lights".
Mike van Dulken, head of research at Accendo Markets, says that they're now "sceptical as to the usefulness of September US jobs data" and that the outcome should "keep markets optimistic thanks to an accommodative Fed".
The shutdown may also have an impact on the accuracy of these numbers, so we'll have to look for future revisions, but that's not the only thing that will be affecting trader mentality.
Christopher Vecchio, currency analyst at DailyFX, says that as this is a Tuesday release (as opposed to the traditional Friday announcement) traders won't give the NFP stat the same attention. Vecchio says that "traders treat the typical Friday report dramatically because of the day it falls on; the last trading session of the week means traders need to close books and square positions for Monday's Asia open."