US Jobs Report Disappoints with Only 29,000 New Positions Added in September

The US economy added only 29,000 jobs in September, falling short of the expected 84,000. The unemployment rate rose to 4.2% from 4.1%, while the labor force participation rate edged up to 61.8%. The weak report increased market expectations that the Federal Reserve will keep interest rates unchanged at its October meeting.

The jobs data also included significant downward revisions to previous months, with July payroll growth revised from an initial increase of 21,000 to a decline of 10,000 and August growth revised from 162,000 to 133,000. This reduced combined employment gains for July and August by 60,000 from previous estimates.

The unemployment rate has remained within a relatively narrow range of 4.1% to 4.3% since March, while the employment-population ratio stood at 59.2% in September. The weak report strengthened expectations that the Fed will maintain a hawkish stance.

Gold prices fell on Friday after initially gaining more than 1% following the weak employment report. Spot gold declined 0.75% to $4,146.54 an ounce and was down about 3.19% for the week. A stronger dollar and higher Treasury yields weighed on the non-yielding metal.

Oil prices were mixed after European countries agreed to release additional diesel stockpiles, easing concerns over fuel supplies. West Texas Intermediate declined 1.72%, to $91.28, while Brent crude reversed initial loss of 1.76% and was trading 0.24% higher at $102.56.

The US Treasury yields initially declined after the weak employment report but later reversed higher. The 10-year yield rose almost five basis points to 5.292%, while the 30-year yield increased three basis points to 5.642%. The two-year yield, which is particularly sensitive to expectations for Fed policy, rose five basis points to 4.841%.