U.S. employers added 29,000 jobs in September, well below forecasts near 90,000, and the unemployment rate rose to 4.2% from 4.1%. By Sunday afternoon, markets priced about a 77.9% chance the Federal Reserve holds the policy rate at its 28 October meeting. Kitco reported that average hourly earnings rose 0.1% with the Bureau of Labor Statistics print. The federal funds target range is already 3.75% to 4.00% after the September hike, the first increase since July 2023. The effective rate was 3.88% on 1 October, and the bank prime rate was 7.00%, on the Fed's H.15 release dated 2 October. The 10-year Treasury yield was 5.24% that day, down from 5.29% on 30 September. The 30-year was 5.61%.
A hold in October does not cap the 10-year
A week earlier, desks had priced an October hike as the base case. Implied odds sat near 68% on 28 September, when the 10-year was at 5.22%. The Herald Business reported Sunday that hold odds had risen to 77.9%, from 75.6% on Saturday. December is now the meeting markets treat as live. Chair Kevin Warsh's path, on this print, is a pause after one hike, unless inflation data before 28 October reverses the jobs signal. Minutes of the September meeting are due this week. Long yields stayed near their highest levels in years even after the miss. Gold, bid near $4,138 on Sunday, is down about 3% on the week because the coupon is what bullion trades against. Brent near $102.70 keeps an inflation risk in the December debate. Bitcoin holding $84,860 is the same split: easier October odds, and a 10-year that is still at 5.24%. See oil and gold after the jobs print, the bitcoin tape, and last week's 68% hike pricing.