Huatai Securities: It is difficult for the Federal Reserve to raise rates again in October; under the baseline scenario, another rate hike in December.

Huatai Securities pointed out that the September nonfarm payrolls report fell short of expectations, reducing the urgency for the Federal Reserve to raise rates consecutively in the short term. As single-month nonfarm data are highly volatile, based on the 3-month average, new nonfarm payrolls came in at 51,000, near the equilibrium employment level. Combined with the unemployment rate still at a low level, this indicates that the labor market remains solid but hardly tight. The weakening of September nonfarm payrolls, coupled with a decline in wage growth, led to a slowdown in real income in September, and household consumption may also struggle to sustain the strong performance seen in August. Looking ahead, the forward-looking NFIB hiring willingness indicator suggests that October nonfarm payrolls may remain weak, but nonfarm payrolls could rebound thereafter. Therefore, Huatai Securities believes it will be difficult for the Federal Reserve to raise rates consecutively in October, and under the baseline scenario, another rate hike in December.