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US Jobs Growth Accelerates

US Jobs Growth AcceleratesUS Jobs Growth Accelerates

US jobs growth staged a bigger recovery than expected in April as businesses added 211,000 posts.

Figures from the US Department of Labour also showed the unemployment rate dropped slightly to 4.4%, compared with 4.5% in March, BBC reported.

The rebound in the jobs market could pave the way for the US central bank to raise interest rates in June.

The economy needs to create 75,000 to 100,000 jobs a month to keep pace with growth in the working-age population.

An unemployment rate of anything under 5% is considered to indicate full employment. The rate of 4.4% is the lowest since May 2007.

The rise in employment was driven by the leisure and hospitality sectors, health care and social assistance, financial activities and mining.

The figures represented a strong bounce-back following the disappointing figures recorded in March, when only 79,000 jobs were created, said Kully Samra, UK managing director at Charles Schwab.

“With the Fed hitting the pause button in May, the recovery in today’s employment data gives weight to the prospect of a further rate hike in June and the possibility of two or three more this year,” he added.

Earlier this week, the US Federal Reserve kept its key interest rate on hold in a range of 0.75% to 1%.

The Fed has only raised interest rates three times in the past decade, most recently in March this year.

US GDP grew at an annual rate of 0.7% in the first three months of this year, the slowest rate since the first quarter of 2014.

But the central bank said it viewed “the slowing in growth during the first quarter as likely to be transitory” and still expected economic activity to “expand at a moderate pace”.

 

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