The solid labor market report for September makes any change by the Fed difficult.

An increasing number of forecasts for a recession in 2020 have been based on a slowdown in growth in the labor market. The September labor data calls this into question. The biggest surprise was the drop in the unemployment rate to 3.5% from 3.7% in August. Employment in the household survey was reported as having increased by 391,000 while the size of the labor pool increased by only 117,000. The 3.5% unemployment rate was the lowest since 1969. This tight labor market may be the reason nonfarm payrolls were reported as having increased by 136,000 in the corporate survey. Expectations were for an increase of 145,000. However, job growth was revised upward for both July and August.