US Market: Fed’s Hammack says jobs data gives time to assess rate path

Federal Reserve Bank of Cleveland President Beth Hammack said the September US employment report was broadly consistent with recent hiring trends, giving the central bank time to assess incoming data before deciding on its next monetary policy move, Reuters reported.

The September report showed a gain of just 29,000 jobs, while the unemployment rate rose to 4.2%. Hammack said the figures were broadly in line with recent labour-market performance, pointing to a period of relative stability in hiring.

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Hammack noted that average monthly job creation over the past year was around 41,000, which she considers broadly consistent with the pace needed to keep the labour market stable, Reuters reported.

Hammack also indicated that the Federal Reserve has several weeks to assess incoming economic data before its next policy meeting. Officials will have additional employment, inflation and economic activity indicators to consider before determining the appropriate policy stance.

Hammack has been among Fed officials taking an early and firm stance on keeping inflation pressures under control. She has supported higher interest rates as necessary to bring inflation back toward the central bank’s target.

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Her comments come after several Fed officials this week signalled that policymakers have time to assess the economic outlook before making further changes to interest rates. The September employment data, while weak on the headline numbers, did not appear to prompt an immediate change in that approach.

The Fed last month raised its benchmark interest-rate target by 25 basis points to a range of 3.75% to 4%. Policymakers had indicated that another rate increase could come before the end of the year, although recent comments from officials suggest no immediate action is expected at the Federal Open Market Committee meeting scheduled for October 27-28, Reuters reported.

The latest remarks highlight the Fed’s continued focus on balancing its dual mandate of maximum employment and price stability. With hiring showing signs of slowing but remaining broadly stable, policymakers are likely to weigh labour-market trends against persistent inflation pressures before deciding whether further rate increases are warranted.

(Disclaimer: This article is based on inputs from agencies. These do not represent the views of The Economic Times)