White House CEA Chair Phelan Says Fed Unlikely to Hike Again This Year After Weak September Jobs Report

White House Council of Economic Advisers Chairman Chris Phelan said on October 2, 2026, that the Federal Reserve is unlikely to raise interest rates again this year, citing a weak September jobs report and softer inflation data. U.S. employers added just 29,000 jobs in September, far below the 88,000 consensus estimate and the revised 133,000 gain in August. The unemployment rate edged up to 4.2% from 4.1%. Phelan said the economy needs only about 40,000 new jobs monthly to hold unemployment steady. Phelan called the Fed's September rate hike a "mistake," arguing inflation was already cooling before policymakers acted. The core PCE price index rose 3.0% in August, down from 3.3% in July, with its three-month annualized average at 2%. Fed Vice Chair Philip Jefferson and New York Fed President John Williams struck dovish tones, saying there is no need to rush further tightening.