Hurricanes and the Boeing strike are the name of the game in October, and we expect this combination of shocks to heavily (but temporarily) distort this month's jobs figures. Underlying this, though, high-frequency data was already pointing to a slower month of hiring than September, TDS’ analysts note,

US elections may cause further USD rallies

“Given the crowded data and event schedule, markets may struggle with the reaction to the payroll report unless it is significantly above or below consensus. We expect rates to bull steepen if our forecast for a notably weaker payroll report proves correct, but the upcoming US election and FOMC meeting could blunt the impact of a data surprise.”

“Given the unique and noisy circumstances of this report, markets should not draw any meaningful signal and as US data in aggregate has been relatively more resilient. Our positioning indicators now flag the USD as long which does pose a risk to further USD strength.”

“Catalysts for further USD rallies now lie in the outcome of US elections particularly if the risk of a Trump Presidency is realized with tariffs and tax cuts.”