This morning's payroll employment report for September and upward revisions for July and August were much stronger than the consensus expected. We weren't surprised. They should bury the looming recession scenario. Stock futures immediately surged, the 10-year Treasury yield rose 10bps to 3.95%, and the dollar moved higher.
As we previously observed, the Fed's 50bps cut in the federal funds rate on September 18 wasn't necessary with the US economy doing so well. Fed officials announced they were committed to keeping the unemployment rate from rising. It fell to 4.1% in September from 4.3% in July. Now, for the rest of this year it might be none-and-done for the Fed. Any further rate cuts would increase the odds of our 1990s-style meltup scenario for the stock market. But for now this continues to be a squarely Roaring 2020s economy. Here's more on today's data:
(1) Payrolls. Payroll employment increased by 254,000 in September to another record high, the largest increase since March (chart).
