Federal Reserve May Still Cut Rates Despite Employment Report Delay

Despite the government shutdown causing a delay in the official non-farm employment report release, Morgan Stanley’s Chief U.S. Economist Michael Feroli believes the Federal Reserve should proceed with a rate cut later this month. Feroli highlights that recent private sector labor market data, such as ADP figures, has provided valuable insights into the current job market. These indicators show weakness in hiring activity for September, modest wage growth, and reduced labor demand – all factors contributing to a cooling labor market trend that supports the Fed’s decision on a rate cut.