The US posted a solid job report showing job gains of 248,000 in line with our estimate of 250,000 (consensus: 215,000). Net revisions were also positive at +69,000 so overall quite a bit stronger than expected. The three-month moving average now stands at 224,000, a somewhat better picture following last months' report where it was 207,000 (prior to todays revisions). We believe this the 224,000 level reflects the true underlying state of job gains currently.
The payrolls this month were lifted by the end to the strikes in August, which gave a swing from -16,000 to +19,000 in the Food and Beverage sector. This will come down a bit again next month to the normal rate of around +5,000. Service employment rose 207,000 but is still below what ISM non-manufacturing suggests.
The unemployment rate showed a marked improvement from 6.1% to 5.9% supported by stronger employment in the household survey of 232,000. A decline in the labour force also contributed to the lower unemployment, though, as 97,000 fewer persons were in the labour force in September.
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