MNI US Payrolls Preview: Sequentially Softer But Still Solid

EXECUTIVE SUMMARY:

• Consensus looks for a payrolls report that would imply only a marginal easing in labor market tightness in October, with supply struggling to recover to pre-pandemic levels and an u/e rate near record lows.
• The usual combination of unemployment and participation rates will guide the market reaction, with AHE perhaps having less sway coming soon after the ECI in Q3, barring a notable surprise. ·
• Still, an in-line reading or higher would deliver a modestly hawkish reaction, with the FOMC meeting this week renewing policymakers’ concern that they haven’t yet seen much softening in the labor market.

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