Fed Sees Cooling Labor Market as Rate Hike Odds Tumble

The Federal Reserve may skip its planned October interest rate hike due to a cooling labor market. The US added only 29,000 jobs last month, falling short of the expected 90,000. This downward revision of August's payroll gains also contributed to the disappointing numbers.

The unemployment rate ticked up to 4.2 percent from 4.1 percent. Despite this, interest-rate futures contracts are now pricing in less than a one-in-five chance of a rate hike at the October meeting, down from over one-in-four previously.