The Day at a Glance | October 6 2023

*September´s US employment report showed that job creation was much stronger than expected. Additionally, the unemployment rate remained unchanged at 3.8%.

*In the lead-up to next week’s annual meeting between the World Bank and the IMF in Morocco, emerging economies are facing headwinds from all sides due to China’s slowdown, financing for Ukraine, and uncertainty in the US. 

*The ECB may need to raise interest rates again if wages, profits, and demand drive inflation, according to Isabel Schnabel, a member of the ECB’s Board.

*Russia lifts ban on most diesel exports.

Economic environment

September´s US labor market figures suggest that the job market remains strong. This Friday, the US Bureau of Labor Statistics released September´s employment report, which showed a higher job creation during the month compared to the market’s expected 187,000 jobs, with a 336,000 figure. However, this was partially offset by August´s reading being revised (from 187,000 to 227,000 jobs). These figures were not affected by the automotive strike or the Hollywood strike at the time of the survey. On the other hand, the unemployment rate remained unchanged at its highest level in 18 months at 3.8%. Similarly, wage revisions saw a moderate increase, 0.2% m/m, similar to what was seen in August, resulting in an annual 4.2% increase, slightly lower than the 4.3% y/y rate logged in the previous month. While September´s figures prove the labor market´s resilience, which could translate into higher-than-expected economic growth in the 3Q23, this suggests that there may still be room for the Federal Reserve to carry out another interest rate hike this year and maintain its restrictive stance for a longer period of time.