Tonight, the U.S. September non-farm payrolls (NFP) data will be released, with a significant divergence emerging between the forecast market and Wall Street.
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Ahead of the upcoming release of the U.S. September non-farm payrolls (NFP) report, prediction market traders are betting that job growth will exceed the consensus forecast of Wall Street economists. Data from Kalshi shows the market assigns a nearly 60% probability to U.S. September NFP gains exceeding 90,000 jobs, and roughly a 50% chance of gains topping 100,000 jobs. However, Wall Street investment banks’ outlooks for September NFP are broadly cautious. Goldman Sachs projects 80,000 new non-farm jobs in September, with the unemployment rate holding steady at 4.1%. Bank of America, meanwhile, forecasts just 60,000 new jobs for the month, including 50,000 in the private sector. These forecasts indicate that Wall Street banks are not broadly betting on a sharp rebound in September employment; some institutions even project job gains significantly below the market consensus, highlighting a clear divergence between prediction markets and traditional macroeconomic forecasts. On Tuesday, after New York Fed President John Williams downplayed the urgency of further interest rate hikes, federal funds futures data showed the market’s probability of another rate hike next month fell from around 71% to 50%. The September jobs report could be particularly critical to breaking this deadlock in rate hike pricing.
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