'Surprising increase' in employment of 165,000 people in October in the US... Outlook for interest rate hike in December strengthens (comprehensive)

U.S. jobs increased more than expected in October.

With the unemployment rate falling and wage growth exceeding market expectations, the possibility of the U.S. Federal Reserve (Fed) raising the benchmark interest rate in December is expected to gain strength.

The U.S. Department of Labor's Bureau of Labor Statistics announced on the 6th (local time) that the number of non-farm jobs in the U.S. increased by 165,000 in October compared to the previous month.

This figure is approximately 2.8 times higher than the 59,000 expected by experts compiled by Dow Jones. It also exceeds the average monthly increase over the past 12 months (48,000 people).

Employment indicators were also revised significantly upward in the previous two months.

Employment in July was revised to 186,000 and September employment was revised to 60,000, an increase of 53,000 and 31,000, respectively. New employment over the past two months has increased by a total of 84,000 compared to the previous announcement.

By industry, professional and business services led the increase in October with an increase of 70,000 people. This was followed by the largest increase in health and medical services (42,000 people), transportation and warehousing (25,000 people), and manufacturing (19,000 people).

This is a change from the past, when the health and medical sectors accounted for most of the increase.

It is also noticeable that employment in the construction sector decreased by 3,000 people. Bloomberg News pointed out that employment in the construction industry, which had been on the rise thanks to the data center construction boom, turned to decline for the first time in eight months.

The wage growth rate was also higher than expected.

The average hourly wage in October was $38.00, up 0.4% from the previous month and 3.1% from the same period last year.

This figure exceeds market expectations of 0.3% and 2.9%.

The unemployment rate was calculated at 4.1%. It fell from a month ago (4.2%) and fell below experts' expectations (4.2%).

The unemployment rate in the United States has remained in the range of 4.1 to 4.3 percent since last March.

With the announcement of stronger-than-expected employment indicators, financial markets say that the Federal Reserve's ability to focus on suppressing inflation has been confirmed.

According to the Chicago Mercantile Exchange (CME) FedWatch, the futures market sees a 74.8% chance that the Federal Reserve will raise the benchmark interest rate at the Federal Open Market Committee (FOMC) in December. This is an increase from 66.9% the previous day.

Government bond interest rates showed an upward trend, but the extent was not significant.

As of 9:08 a.m. Eastern time, the U.S. 10-year Treasury bond yield, which is the benchmark for global bond interest rates, was 4.864%, up 2.7bp (1bp = 0.01% point) from the previous day.

The yield on US 2-year Treasury bonds, which are sensitive to monetary policy, rose 4.2bp to 4.346%, and the yield on US 30-year Treasury bonds rose 2bp to 5.27%.