Will the Fed cut interest rate again this month end?

U.S. employment accelerated in September and revised figures for August showed an unexpected gain, easing recession concerns and making the Federal Reserve less likely to cut interest rates again.

Payrolls grew by 110,000 after an 89,000 increase in the previous month, the Labor Department said today in Washington. The change to the August figure wiped out what had been the first decline in four years, a drop that spurred predictions the six-year expansion would come to end amid the credit-market rout.

Treasury notes fell as traders speculated that the central bank, which reduced borrowing costs by half a point on Sept. 18, will hold fire this month. Analysts said more jobs and rising wages will help consumers weather falling home prices, sustaining the spending that accounts for more than two-thirds of the economy.
This report reduces the odds that cut will come in the October meeting.

`Nimble' Fed
Fed Vice Chairman Donald Kohn said officials must be ``nimble'' in setting rates given the risks of both slower growth and faster inflation. He avoided any indication in his Philadelphia speech that the central bank is preparing to lower rates again.

`Not Breaking'
Factory payrolls dropped by 18,000 after decreasing 45,000 a month earlier. Economists had forecast a drop of 10,000 in manufacturing employment.
Payrolls at builders declined by 14,000 after falling 22,000 a month earlier.
Lennar Corp., the biggest U.S. homebuilder, has cut 35 percent of its workforce and will eliminate more. Lennar last month reported the biggest quarterly loss in its 53-year history.

Real-Estate Jobs
Firings at mortgage companies are also contributing to the slowdown in the labor market. Morgan Stanley, the second-biggest U.S. securities firm, said this week it plans to cut 600 jobs after a decline in mortgage-related revenue led to lower third- quarter earnings than analysts estimated.
Further turmoil in credit markets ``might have serious consequences for employment stability,'' Fed Bank of St. Louis President William Poole said in a speech in New York on Sept. 28.
The Fed on Sept. 18 cut its benchmark interest rate by a half-percentage point to 4.75 percent, and said they would ``act as needed'' to promote stable inflation and economic growth.
Poole said that while he sees ``tentative signs'' that credit-market turmoil is easing, ``financial fragility is obviously still an issue.''
So far, income gains have helped prevent a collapse in consumer spending, and some companies are still adding workers as they expand.

Tracking the Dow Movement on Thursday.(4/10/2007)

Noticeable long bullish white candlestick bar were gearing up towards the resistance(MAV) near the closing bell.Very powerful and will likely to pierce through.

It's a beautiful "morning star" formation.Gear up for a cheerful day! http://www.litwick.com/indicators/1130.html