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The US job growth on Friday was expected to have risen at a fast pace in February, lowering unemployment rate to a more than 17-year low, but wage increases likely slowed down after three consecutive months of gains.

In February, the US probably has 220,000 new jobs, with the number of unemployed individuals dropping to 4 percent for the first time since the end of 2000.

Non-farm payrolls was estimated to have grown by 200,000 jobs in February, higher than the monthly average of 181,000 in 2017 and the about 100,000 employments per month required to keep pace with growth in the working-age population.

Hourly earnings likely added 0.2 percent in prior month, continuing strong gains since its unexpected fall in October.

Manufacturing payrolls are also expected to have gained 15,000 jobs, with robust domestic and international demand, as well as a weaker dollar bolstering the sector.

Construction employment was estimated to increase by 34.4 hours, after slipping to 34.3 hours in January.

US Jobs Growth to Support Fed Rate Hike Expectations

Employment data from the US Department of Labor (DOL) is due to be released later in the day. The report is expected to show the economy’s strength and support the possibility that the Federal Reserve will lift its interest rate forecasts for 2018.

US markets nearly priced in a rate increase at the central bank’s March 20-21 policy meeting. The Fed is expected to have three interest rate hikes this year.

US chief economist Beth Ann Bovino said a stronger jobs report with another healthy wage gains improves the odds of the bank having a fourth rate hike before the end of the year.

However, investors worry that a tight labor market will bolster wages and inflation, pushing the Fed to hike rates more aggressively, which could slow the economy and leave a negative impact on stocks and bonds.  

Senior economist Ryan Sweet stated that they are beginning to see a hawkish rhetoric coming from the dovish wing of the central bank.  

US Jobless Claims Mark 48-Year Low

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The number of layoffs as measured by the US jobless claims increased last week, rising from a more than 48-year decline.

The Labor Department said on Thursday the rate of people filing for unemployment benefits in the week ending March 3 was up by 21,000 to 231,000, its highest level in six weeks.

Analysts expected jobless claims to have grown by 10,000 to 220,000.

Unemployment benefit applications fell to 210,000 in the previous week, its lowest level since December 1969.

This was the 157th straight week that claims stayed below the 300,000, a level which suggests a strong job market. It was also the longest since a similar run that ended in 1970, when the labor market was a lot smaller than it is today.

The steadier monthly average of claims climbed by 2,000 to 225,500, but was just slightly higher than its 50-year low.

Continuing jobless claims in the week ended February 24 has dropped by 65,000 from 1.93 million in the prior week to 1.87 million.

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