(Updates market reaction, adds comments)
Sept 2 Traders of U.S. short-term interest rate
futures trimmed expectations that the Federal Reserve could soon
lift interest rates after a government report showed U.S.
employers added fewer jobs than expected last month.
Nonfarm payrolls rose by 151,000 jobs last month after an
upwardly revised 275,000 increase in July, the Labor Department
said on Friday. Economists had expected a gain of 180,000.
"It is not a compelling number for the Fed and it is not
going to force their hand for a hike in September," said Thomas
Simons, an analyst at Jefferies.
The Fed is now seen as only slightly more likely to raise
rates in December than to wait until next year before raising
rates. Traders are all but ruling out a rate hike later this
Before the report traders saw better than even odds of a
December rate hike, based on trading in futures tied to the
Fed's policy rate, and a one-in-four chance of a rate hike when
the Fed meets Sept. 20-21.
(Reporting by Ann Saphir; Editing by Chizu Nomiyama)