US September Non-Farm Payroll Preview: Job growth is expected to slow, and expectations for another interest rate hike in October have dropped significantly.

The U.S. will release its September nonfarm payrolls report at 20:30 Beijing time on Friday. A latest Reuters poll shows U.S. September nonfarm payrolls are projected to rise by 90,000, a sharp drop from August’s 162,000, while the unemployment rate is expected to hold steady at 4.1% for the third consecutive month. Following the Federal Reserve’s first interest rate hike in three years in September, this report will serve as a key data point to assess whether the labor market remains resilient and whether further rate hikes are needed in October. Markets are not only focused on the new payroll additions. August’s jobs data came in stronger than expected, but some economists argue this may have been distorted by seasonal adjustment factors, raising the possibility that August’s gain could be revised downward when September’s figures are released. Ahead of the September nonfarm payrolls release, market expectations for another Fed rate hike in October have plummeted. As of Thursday, the market priced in a roughly 28% probability of a rate hike at the Fed’s October 27-28 meeting, down from nearly 69% a week earlier. Therefore, the most critical takeaway from tonight’s jobs report is not just whether nonfarm payrolls hit the 90,000 market consensus. Whether the unemployment rate can stay at 4.1%, wage growth will reaccelerate, and August’s robust 162,000 gain will be revised significantly lower will together shape the market’s assessment of the U.S. labor market’s resilience and the Fed’s next policy path.