It’s the first week of a new month and you know what that means: Top-tier US macro data. Lots of it.

The big event’s obviously payrolls. Economists expect to hear the US added 146,000 jobs in September.

Assuming consensus and, naively, no revisions, the three-month moving average for the NFP headline would move up to 126,000. But there will be revisions. And, as market participants were reminded following the last US jobs report, the revisions can be more meaningful than the headline for monetary policy expectations.

Whatever you want to say about the current state of the labor market and whether the readily apparent deceleration justifies a succession of half-point Fed cuts, the trend’s clear enough, and it’s just a matter of time before the headline prints too close to negative territory for comfort.

The Fed’s reaction function is skewed very heavily towards the employment side of the mandate now. Last week’s PCE price updates suggested inflation’s tracking right around target depending on what lookback you prefer (even as core PCE remains well above 2% on the “traditional” 12-month measure). Although revisions to the BEA’s income series (and thereby to the saving rate) suggested the consumer’s still fine in aggregate, all that matters at this point in the cycle is jobs, according to the Fed. Everything follows from the labor market. If there are jobs, there’s income and there’s spending. If not, not. There can be (and indeed, there was) too much of a good thing in that regard post-pandemic, but according to Jerome Powell, jobs aren’t likely to be plentiful enough going forward to put a wage-price spiral back on the table. As it happens, the labor differential in the Conference Board’s data concurs. Bottom line: Good news will be discounted and bad news amplified (overweighted) when it comes to the Fed’s next move.

It’s worth noting that jobless claims for NFP survey week were quite low. In addition, the last jobs report came with a warm-ish read on average hourly earnings. And in the highly unlikely event of a big headline NFP beat this week — gasp — and benign revisions to the prior two months — gasp again — traders would need to rethink bets on anything more than 75bps of additional cuts through year-end. But frankly, it’s going to take a lot to disabuse the market of the suspicion that the balance of the Committee is just fine with cutting in 50bps increments in the presence of air cover from the data.

“Let us not forget that the timing of the next FOMC meeting will afford the Committee the information contained within the October BLS data as well,” BMO’s Ian Lyngen and Vail Hartman remarked. “It’s tempting to look toward Friday’s employment report as the input that will resolve the 25bps versus 50bps debate, but we’ll caution against such an approach,” they added.

The figure above, from Lyngen, shows the path down to neutral (or where the Fed imagines nominal neutral might reside) based of different rate-cut permutations. If the Fed delivers on the 100bps of additional easing tipped (however narrowly) by the median 2024 dot, quarter-point cuts at each subsequent meeting would bring the funds rate down to neutral by next summer.

In the context of the October jobs report which, as Lyngen noted, the Fed will see prior to the November policy decision, it’s worth asking how much weight the Committee will (or should) assign to that release. It’ll presumably be affected by the Boeing drama, could be impacted by a dockworker strike and also by the fallout from Hurricane Helene which, in addition to whatever distortions the storm’s trail of destruction introduces into the macro data, also served as a rather poignant reminder that the species (our species) is on borrowed time. I’m going to re-read “Oblivion” today. I invite you to join me.

In addition to payrolls, traders will get a refresh on the BLS’s JOLTS series. As a quick reminder, the last release showed America’s back to one open job for every one person officially counted as jobless. That’s good news for the Fed.

Never mind if those openings are a good fit for the people who could ostensibly fill them. And vice versa.

ADP private payrolls for September are due on Wednesday. Recall that the series printed 99,000 for August. It was the first sub-100,000 ADP headline since January of 2021. Challenger jobs cuts (on Thursday) will garner some attention as well after showing the most layoffs for any August since 2009 in the last update.

As for the ISM releases, market participants expect confirmation that the US expansion remains a bifurcated affair. The manufacturing headline’s seen in contraction territory for what would be a sixth straight month and a 23rd in 24. The services gauge, meanwhile, should show a modest expansion — economists expect 51.6 from the headline. Recall that the S&P Global PMIs suggested price pressures were building anew this month.

There are plenty of Fed speakers, including Powell. He’ll talk about the economy and, presumably, policy, at a NABE conference on Monday.