Market-implied probability for a December Fed rate cut fell sharply after the Bureau of Labor Statistics unexpectedly canceled the September jobs report, removing a key data point just weeks before the Federal Open Market Committee meets on Dec. 9-10.
Futures that had priced in a near-certain cut dropped to roughly even odds as traders reassessed the path of monetary policy without the headline employment figures. Fed officials have signaled that another cut is "not a foregone conclusion," and the missing report adds uncertainty to what had been a narrowly divided deliberation within the committee.
Analysts said the cancellation forces policymakers and markets to rely on a patchwork of alternative labor indicators that are often noisier and less comprehensive. Stock markets dipped as rate-sensitive sectors reacted to the increased uncertainty, and strategists warned the Fed could see an unusually high number of dissents at the December meeting.
Attempts to obtain further comment from the BLS and the Fed were unsuccessful. The situation underscores how heavily markets had leaned on the monthly employment release to gauge the timing and size of future rate moves.