US jobless rate rises as employment growth slows in September.

The prospect of a rise in US interest rates remains on the cards despite concerns for the world economy and now stronger evidence of a domestic hiring slowdown.

The official US employment figures for September showed 156,000 net new jobs were created in the month - 20,000 fewer than economists had forecast - and down from a downwardly revised 167,000 in August.

The jobless rate also rose to 5% - up from 4.9% the previous month - as more Americans looked for work.

The dollar remained largely static against the pound in the wake of the statistics, though US stock markets opened higher.

Average monthly job gains have been about 180,000 this year and the latest wage figures also confirmed that increases were still lagging behind levels seen before the financial crisis.

While the chair of the Federal Reserve, Janet Yellen, has made job growth and wage increases core factors in determining the timing of potential rate rise - the second since the end of the recession - she has described hiring levels as "unsustainable".

The central bank chief has declared satisfaction with the general health of the US economy - despite its struggles to achieve solid GDP growth.

The International Monetary Fund slashed its expectations for US output growth earlier this week to just 1.6% for 2016.

The world's lender of last resort also raised fears for the world economy with trade levels falling and protectionism looming large in its outlook.

It is on that basis, rather than for domestic reasons, that the Fed may hold off on a rate increase. A rate hike would also strengthen an already strong dollar.

Many other central banks have been loosening rather than tightening their policy stance to support lending and economic activity.

Analysts see no chance of a rise next month - just ahead of the presidential election - but believe the rate-setting committee may seriously consider a tightening in December without a sign of economic or market turmoil.

The job creation figure was seen as buying the Fed some more time.

Michael Jones, chief investment officer at Riverfront Investment Group, said: "This is a good number all the way around.

"It's strong enough that you're not worried about the US slipping back into the kind of slump that we had in the first quarter, but it's not so strong that it precipitates immediate action from the Fed."


Sky News.
Culled from Yahoo News.