Goldman Sachs Report Drops Odds of Recession to 15 Percent

U.S. job gains increased by the most in six months in September and the unemployment rate fell to 4.1 percent, the Labor Department reported on Friday.

Staff
Share 
Goldman Sachs Report Drops Odds of Recession to 15 Percent
Atlanta Jobs
Atlanta Jobs

atlanta jobs tagged interest

U.S. job gains increased by the most in six months in September and the unemployment rate fell to 4.1 percent, the Labor Department reported on Friday.

The September employment report has “reset the labor market narrative” and calmed fears about the labor demand “weakening too quickly to prevent the unemployment rate from trending higher,” Goldman Sachs chief U.S. economist Jan Hatzius said in a note on Sunday.

The Wall Street brokerage maintained its forecast of consecutive 25 basis points cuts to reach a terminal rate of 3.25 percent-3.5 percent by June 2025.

“We now see much less risk of another 50-bps rate cut,” Hatzius said.

The Federal Reserve cut its policy rate by 50 bps in September to the 4.75 percent-5.00percent range, its first rate reduction since 2020.

Financial markets boosted the odds of a quarter-percentage-point reduction in November to 95.2 percent from 71.5 percent before the report, CME Group’s FedWatch tool showed.

While the job numbers have been volatile, they can likely be taken at face value as there are no clear indications for further persistent negative revisions, the Wall Street brokerage said.

“More broadly, we see no obvious reason for job growth to be mediocre at a time when job openings are high and GDP (gross domestic product) is growing strongly,” Hatzius said.

However, October is likely to be a particularly complicated month, with both a hurricane and a major strike threatening to depress payrolls, the brokerage cautioned.

October 18, 2024

Story attribution: Staff
Atlanta Jobs

Share 

Stats
Elapsed time: 0.7200 seconds
Memory useage: 2.28MB
V2.geronimo