The United States Labor Department released a report on Friday showing stronger than expected job growth in the month of February. Data showed non-farm payroll employment jumped by 235,000 jobs in February after surging up by a revised 238,000 jobs in January and beating forecasts for a climb by about 195,000 jobs.
Employment in goods producing sector added 95,000 jobs and was the main driver behind the rise. The construction industry added 58,000 jobs, while the manufacturing and mining sectors added 28,000 jobs and 9,000 jobs, respectively.
The unemployment rate edged down to 4.7 percent in February from 4.8 percent in January, in line with expectations. The report also said the annual rate of growth in average hourly employee earnings accelerated to 2.8 percent in February from 2.6 percent in January.
Upbeat labour market data has reinforced expectations of an interest rate hike by the Federal Reserve this week. Markets have fully priced in a Fed hike this week. Note that markets price a 50 percent probability of another hike in June. Markets price in 2.7 hikes this year and nearly a total of five hikes before year-end 2018.
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