The key points
Payroll growth smashed expectations in March with 178,000 jobs added compared to expectations for gains of just 60,000
The unemployment rate fell to 4.3 per cent in March, down from 4.4 per cent in February and defying expectations for it to remain steady
A big upward revision to January payrolls and a downward one for February left the picture for the year largely unchanged
The verdict
US job growth figures bounced upward during March after the start of the war in the Gulf and the shock of higher energy prices. These figures have been volatile this year with surprisingly strong job growth in January followed by a large decline in February.
When data behaves like a yo-yo, the Federal Reserve is unlikely to have strong convictions about trends or the necessary monetary policy response. The figures suggest the Fed is meeting its maximum employment mandate and that makes near-term rate cuts unlikely. The bar for a rate rise is very high.
The details
Private payroll growth was even stronger, with 186,000 jobs added in March than the overall rise in jobs. Much of this was a bounceback from February’s weakness, which was itself affected by strikes and adverse weather.