Sunday, November 04, 2007

US employment data better than expected


Ashley Seager
Friday November 2, 2007
Guardian Unlimited

The number of jobs created outside the volatile agricultural sector in the United States jumped by 166,000 last month, data showed today, double what Wall Street pundits had predicted.

The figure was the strongest in five months and cast doubt over the likelihood of further interest rate cuts from the Federal Reserve after it reduced borrowing costs to 4.5% earlier this week.

The strong non-farm payrolls data follow surprisingly robust figures for third-quarter economic growth out yesterday.

"Overall, a strong report that suggests the labour market is still holding up despite the recent credit crunch," said Paul Ashworth, analyst at Capital Economics.

"We still expect to see more signs of weakness in the coming months, but those signs might not arrive in time for a December rate cut - we think January is still marginally the more likely time."

Bond prices in the US and Britain fell back on the news while the dollar fell to a record low against the euro. But stock markets trimmed earlier losses on relief of some signs of strength coming out of the world's largest economy.


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