Expectations have been slashed for another hefty cut to base interest by the Federal Reserve after the US economy added far more jobs than expected in September.
Non-farm payroll figures from the US Bureau of Labor Statistics showed 254,000 jobs were added across the economy last month, against expectations for 147,000.
Unemployment, which was expected to remain at 4.2%, also beat expectations, having dipped to 4.1%.
Expectations for another 50 basis point cut to base interest in November, following September’s reduction, were swiftly cut as concerns over an impending recession were further removed.
Money markets were pricing in a 6% chance of such a cut at the Fed’s next meeting on Friday following the data, down from 54% just a week ago.
“Looking at the labour market strength evident in September’s employment report, the real debate at the Fed should be about whether to loosen monetary policy at all,” Capital Economics’ Paul Ashworth commented.
“Any hopes of a 50 basis point cut are long gone.”
Capital Economics forecast interest would now be cut by 25 basis points at each of the Fed's meetings before the year-end, taking rates to between 3% and 3.25%.