Hiring slows as borrowing costs rise and demand stays resilient
We enter the October 6 week with a softer U.S. labor signal and tighter financing conditions, but not a broad pullback in demand. September payrolls rose by only 29,000 and prior gains were revised lower, while the 10-year Treasury yield reached 5.31% Monday and the latest 30-year mortgage average climbed to 7.28%. At the same time, August consumer spending and construction spending both advanced. In the Dominican Republic, the central bank raised its policy rate to 5.50% as a preventive response to inflation risks.
01 · LABOR
September payroll growth slows to 29,000
U.S. nonfarm payroll employment changed little in September, rising by 29,000, while the unemployment rate was 4.2%. July and August payroll gains were revised down by a combined 60,000, and average hourly earnings rose 3.0% from a year earlier.
The U.S. Treasury's daily par yield curve placed the 10-year yield at 5.31% on October 5, up from 5.28% on October 2 and 5.24% on October 1. The 30-year yield stood at 5.66%.
Freddie Mac's Primary Mortgage Market Survey showed the 30-year fixed-rate mortgage averaging 7.28% as of October 1, up from 7.03% one week earlier. The 15-year average rose to 6.60% from 6.42%.
Consumer spending advances while inflation remains above target
The Bureau of Economic Analysis reported that August personal consumption expenditures rose 0.9% in current dollars and 0.6% after inflation. The PCE price index increased 0.3% for the month and 3.4% from a year earlier; core PCE inflation was 3.0% year over year.
The U.S. Census Bureau estimated August construction spending at a $2.203 trillion seasonally adjusted annual rate, 0.9% above July but 1.7% below a year earlier. Private residential construction rose 1.1% from July, subject to the survey's stated margins of error.
The Central Bank of the Dominican Republic raised its policy rate by 25 basis points to 5.50% at its September meeting. The bank described the move as preventive amid more persistent supply shocks, including higher oil and transport costs and adverse weather conditions.