US Jobs Surge by 165,000, Dollar Rises as Rate Outlook Shifts
Key Facts
The US economy added 165,000 nonfarm jobs in October 2026, exceeding economists’ forecast of 65,000, after September’s increase was revised to 60,000. Reuters said the report lifted the dollar, with its index rising 0.77% to 102.26 on Friday, November 6. The figures came as market bets on a Federal Reserve rate hike in December had fallen in the previous session. After the report, expectations of an increase of at least 25 basis points returned to nearly 80%. By contrast, Canada’s report painted a weaker picture of the labour market, highlighting the divergence in employment trends on either side of the border.
The US unemployment rate fell to 4.1% in October from 4.2% in September, a decline of 0.1 percentage point, according to the US Bureau of Labor Statistics. The drop in unemployment came alongside job gains that more than doubled expectations, strengthening the report’s reading as a sign of continued labour-market resilience. Reuters’ estimate for new jobs in October was 65,000, while the revised increase for the previous month was 60,000. The comparison between the actual figure and the forecast shows that the main surprise was the pace of hiring. The unemployment-rate move reflects another aspect of the report, falling rather than rising from its level the previous month.
The reported October gains were concentrated in professional and business services and health care. Professional and business services added 70,000 jobs, while health care added about 42,000, according to the Bureau of Labor Statistics. The total of 165,000 was spread across multiple sectors, but these two recorded the specified increases in the available data. The sector figures point to their contribution to the month’s gains, without attributing the entire increase to them alone. The overall result was clearly above economists’ forecast of 65,000 jobs.
This contrasted with US job growth, which exceeded economists’ estimates, and the decline in US unemployment in the same month. Data from the two countries again highlighted differing labour-market conditions, while markets took the US report as a signal for the path of US monetary policy. In Canada, Reuters reported that markets pushed back expectations for the next rate increase from January to March.
The reaction extended to the US dollar-Canadian dollar pair: the US dollar rose 0.36% to 1.4070 Canadian dollars on November 6, compared with Thursday’s close of 1.4019. The pair ranged between 1.4009 and 1.4072 during the session, according to data cited by Investing.com. EL7 daily data showed the dollar index closing at 102.175 on the same day, while Reuters said the index rose 0.77% to 102.26 during the session. The two figures reflect different measurement times: the index level during the session in Reuters’ report and the daily close in EL7 data. The US jobs surprise was thus accompanied by gains for the dollar against the Canadian currency and for the index during Friday’s session.
After the jobs report, markets are turning their attention to US inflation data scheduled for November 10. The Bureau of Labor Statistics had set the release of the October Consumer Price Index for 8:30 a.m. Eastern Time that day. Austin Goolsbee was also scheduled to speak at 10:00 a.m., followed by Thomas Barkin at 12:15 p.m. on November 9, according to TD Economics’ calendar. These events follow the jobs report’s revival of market expectations for a December rate hike to nearly 80%, after they fell to about 67% on November 5. The inflation reading and the next two scheduled appearances will be on the watchlist ahead of the December meeting.