Despite the positive sentiment, ING's analyst Rob Carnell, "the unemployment rate fell to 7.8% from 8.1% driven by an improbable (and probably unsustainable) 873K rise in the household survey, swamping the 418K rise in the labour force."
In the previous months, a positive data in the employment report was seen as 'changer' in Fed policies but with the recently QE3 never-ending launching, the Fed shouldn't act too fast specially when there is a presidential election in few weeks. "It seems unrealistic to imagine that any changes to the current QE3 policy will be imminent," says Carnell.
"Perhaps the earliest we might look for any modification to current Fed policy is the 12 December meeting," ING's analyst points. "And by then of course, after 2 more payrolls reports and possibly reversal of today’s unemployment numbers, the Fed may be better placed to judge whether the $40bn per month of QE3 is too much or too little, and take appropriate action."
"For now, nothing needs changing," Carnell concludes.