Data shows US may still need Fed stimulus

Employers in the vast private sector added 130,000 new jobs to their payrolls this month, the ADP National Employment Report showed yesterday. That was the lowest reading since April and was below economists’ expectations for a gain of 150,000 jobs.

September’s private payrolls gains were revised down to 145,000 from the previously reported 166,000 jobs.

The report, jointly developed with Moody’s Analytics, suggested that the 16-day government shutdown early in the month had weighed on an already struggling labour market.

“ADP was weaker than expected, which is consistent with the weaker tone of labour market data we have had recently,” said Eric Stein, co-director of the Global Income Group at Eaten Vance Investment Managers in Boston.

Private jobs growth slowed for the fourth month in a row this month, according to ADP data. Average monthly jobs growth has fallen below 150,000, which if sustained would make it difficult for the unemployment rate to fall further.

In a separate report, the Labor Department said its Consumer Price Index increased 0.2 per cent last month as energy prices rebounded, after edging up 0.1 per cent in August. In the 12 months through September, the CPI increased 1.2 per cent, the smallest gain since April. It had advanced 1.5 per cent in August.