US jobs growth fuels expectations Fed will cut back stimulus early
US job growth unexpectedly accelerated in October as employers shrugged off a partial government shutdown, suggesting the economy was on firm footing and raising the prospect that the Federal Reserve may soon decide to temper its bond-buying stimulus.
Employers added 204,000 new jobs to their payrolls last month, and 60,000 more jobs were created in September and August than previously reported, the Labour Department said.
The unemployment rate, however, rose to 7.3pc last month from September's nearly five-year low of 7.2pc as federal workers were idled.
The department said there had been no "discernible" impact on the payroll figures from the 16-day shutdown.
"This was a resoundingly strong report, particularly in the context of the government shutdown, which was supposed to wreak havoc on this number," said Tom Porcelli, chief US economist at RBC Capital Markets in New York.
Economists polled by Reuters had forecast payrolls rising 125,000 in October and the unemployment rate ticking up one-tenth of a percentage point to 7.3pc.
The gain in employment raised expectations the Fed could curtail its bond-buying programme earlier than expected. Ahead of the report, most economists said the central bank would wait until its meeting in March; after the data, some said it would be unwise to rule out a move as soon as the Fed's next meeting in December.