WEEKLY REVIEW: the interest rate hike by the Fed recedes into the far distance

Today's U.S. labour market data makes it clear that the interest rate hike by the Fed this year is unlikely. According to the U.S. Labor Department, the U.S. economy added 142,000 jobs in September, missing expectations for a rise of 203,000 jobs, after a gain of 136,000 jobs in August. August's figure was revised down from a rise of 173,000 jobs. The U.S. unemployment rate remained unchanged at 5.1% in September, in line with expectations. Average hourly earnings were flat in September, missing forecasts of a 0.2% gain, after a 0.4% increase in August. August's figure was revised up from a 0.3% rise.

The pace of job creation slowed through 2015, while the wage growth is pending on a low level.

The U.S. manufacturing sector faces problems. According to the Institute for Supply Management, the U.S. manufacturing purchasing managers' index declined to 50.2 in September from 51.1 in August, missing expectations for a fall to 50.6. It was the lowest level since May of 2013.

But Fed officials continued to say this week that the interest rate hike by the Fed this year is still possible.

The interest rate hike by the Fed is also unlikely this year because it could hit emerging economies including China. Emerging economies already slowed down this year.

The markets are likely to remain volatile as market participants will look for further clues for the Fed's monetary policy.

It is likely that the currency pair EURUSD will test the level at $1.1400, maybe even the level of $1.1500, if the U.S. economic data will negative and there will be no negative news from the Eurozone.

If the U.S. economic data is positive and in case of the negative news from the Eurozone, the currency pair EURUSD may test the level of $1.1100.