US payrolls rise by 165,000 in October, far above forecasts, as unemployment dips to 4.1%

US employers added 165,000 jobs in October, far more than economists had forecast, according to the nonfarm payrolls report released at 13:30 UTC on 6 November 2026. The unemployment rate fell to 4.1% from 4.2%. Shortly after the release, Bloomberg reported that US Treasuries dipped as traders added to bets that the US Federal Reserve (Fed) will raise interest rates at its December meeting.

What the October jobs report showed

The headline number was the big story. Nonfarm payrolls, the monthly count of US jobs outside the farm sector, rose by 165,000 in October, as reported by CNBC. The unemployment rate edged down to 4.1%, while forecasts had it holding at 4.2%. This came after a weak September, when payrolls rose by only 29K. According to investingLive's preview, August had shown a gain of 133K and July a loss of 10K, so hiring had been uneven over the summer months.

How far the figure beat forecasts

Economists polled by CNBC had expected 59,000 new jobs, while the consensus cited by investingLive and the economic calendar stood at 65K. In investingLive's survey of estimates, most forecasts sat between 50K and 75K, and the highest was 125K. October's figure landed above the top of that range. The unemployment rate also surprised: 74% of forecasters in the same survey expected 4.2%, and only 18% expected 4.1%. Some earlier October indicators had pointed to a firm labour market, such as the ADP private payrolls report at 86K against 67K expected. Others were softer, including Revelio Labs at 26K.

Why the Fed's December meeting is in focus

Before the release, markets had been scaling back their expectations for further Fed rate hikes. The policy rate is the interest rate the central bank sets to steer borrowing costs across the economy. investingLive reported in the morning that the probability of a December hike had dropped to 67%, from roughly 80% earlier in the week, and a later preview put it at 73%. Bloomberg reported that bond traders were positioned for further Treasury gains ahead of the data. After the report, Bloomberg said Treasuries dipped as traders added to wagers on a December hike. When bond prices fall, their yields rise, because the two move in opposite directions.

Read alsoCanada’s unemployment rate rises to 6.7% in October as employment edges lower

The wider backdrop

The jobs data arrived in a busy and nervous week. investingLive pointed to the fallout from the US midterm elections, the US-Iran situation and a sharp sell-off in tech stocks that had weighed on growth expectations. The outlook for artificial intelligence, with Anthropic's upcoming stock market listing, was another key theme. Ahead of the release, analysts stressed that the data could be read in more than one way. A strong report could ease worries about growth, but it could also revive concerns that the Fed may need to tighten policy further. Bloomberg also noted that strong jobs data could reduce the safe-haven appeal of government bonds.

What to watch next

The details of the report matter as much as the headline. Wage growth, measured by average hourly earnings, was expected to rise 0.3% month on month after 0.1%, and traders will look at how pay compares with that forecast. Several Fed officials are scheduled to speak later on 6 November, including Alberto Musalem at 14:10 UTC and Michelle Bowman at 17:15 UTC. The University of Michigan consumer sentiment survey is also due the same day. In North America, Canada's own October employment report was released at the same time, adding another data point for currency traders.

Sources: investingLive, CNBC, Bloomberg, ForexFactory.