No rate cuts likely this year! US October nonfarm payrolls not released, November report unexpectedly to be published after the Fed’s December meeting

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On Wednesday local time, the U.S. Bureau of Labor Statistics (BLS) said that it will not release the October non-farm payrolls report, but will instead include the relevant employment data in the November report. The November non-farm payrolls report will be released on December 16, more than a week later than originally planned, and will come out after the Fed’s final meeting of the year. The September non-farm payrolls report will be released this Thursday.

The U.S. non-farm payrolls report consists of two surveys, one for households and another for businesses and institutions, with the latter used to tally non-farm employment numbers. Due to the record-setting U.S. government shutdown, the BLS was unable to collect October's household survey data—these numbers are used to calculate key indicators such as the unemployment rate. The BLS said such data cannot be collected retrospectively. The BLS also stated it will extend the collection period for November's household and establishment surveys.

Economists had previously pointed out that, because the data collection methods rely heavily on manual labor, there was a risk household survey data might be skipped, but they still expected the October non-farm payrolls data to be released on schedule. Last week, White House National Economic Council Director Hassett said the October employment report would not include the unemployment rate.

While many businesses keep records and report payroll data electronically, it is much more difficult to retrospectively contact residents by phone and have respondents recall their employment status for a specific week in October. The household survey is jointly conducted by the BLS and the Census Bureau, surveying about 60,000 households each month.

The BLS will also skip releasing the September Job Openings and Labor Turnover Survey (JOLTS) report, and on December 9 will publish it along with October's data. Federal Reserve officials will begin a two-day meeting that day.

The BLS has yet to announce when or whether it will release the October Consumer Price Index (CPI).

The delays and cancellations of labor market data will continue to cast a shadow over the Fed's monetary policy outlook. This means the Fed will miss key economic data ahead of its final meeting of the year, even though it relies on these reports to guide its rate decisions.

The BLS’s updated release schedule deprives policymakers and traders of key evidence to support the case for rate cuts. After the announcement, investors saw a reduced likelihood of a rate cut by the Fed in December, as the official data delay could lead to more divided views among policymakers. Bond traders have nearly given up bets on a December rate cut, and the market is betting that the federal funds rate will remain in the 3.75% to 4% range.

There was a wave of sell-offs in federal funds futures. The swaps market linked to the Fed's policy rate shows a roughly 30% probability of a December rate cut, pricing in only about 21 basis points of easing by January next year. Prior to Wednesday, the odds were about 50-50. U.S. Treasuries saw little change that day, with the yield on the two-year note—most sensitive to monetary policy expectations—falling less than 1 basis point to 3.57%.

As several Fed officials urge caution in cutting rates while inflation remains above target, market sentiment had already gradually shifted toward holding rates steady in December. Minutes of the Fed’s October 28-29 meeting showed several officials felt it may be appropriate to keep rates unchanged for the remainder of 2025.

Morgan Stanley economists said, “This reduces the likelihood of a December rate cut. Labor market weakness is a key reason to support cuts in December.”

One industry insider commented, “We already knew there would be no October unemployment rate, but learning that November data will not be released until after the Fed meeting is a disappointment for the market. Given divisions within the FOMC, this reduces the likelihood of a rate cut.”

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