WASHINGTON: US private-sector hiring rose in November at the fastest clip in a year, suggesting the labour market was improving enough for the Federal Reserve to soon start trimming its bond purchases.
But the optimism over the labour market was tempered somewhat by a report yesterday showing a fall in a gauge of services industry employment last month. Still, the economy’s outlook is brightening and other data showed exports hitting a record high in October and new home sales posting their largest rise in nearly 33-1/2 years.
Private employers added 215,000 new jobs to their payrolls last month, the ADP National Employment Report showed, the biggest rise in a year and beating economists’ expectations for a gain of 173,000 jobs. October’s gain was revised to 184,000 from 130,000.
The ADP data comes ahead of the government’s much more comprehensive employment report for November on Friday, which includes both public and private sector hiring. That report is expected to show an increase of 180,000 in nonfarm payrolls, according to a Reuters poll of economists, down from 204,000 in October.
While the ADP report does not have a good track record predicting nonfarm payrolls, economists said it raised the risk of a stronger-than-forecast reading on Friday. US Treasury debt prices fell on the employment data, the dollar rose and US stocks dropped as traders speculated the Fed could begin to trim its bond-buying stimulus as soon as its next meeting on December 17-18.
Separately, the Institute for Supply Management said its services index fell to 53.9 last month from 55.4 in October. A reading above 50 indicates expansion in the sector. November marked the 47th-straight month of growth in the services sector. The survey’s gauge of services industry employment hit a 6-month low in November.
In a separate report, the Commerce Department said the nation’s trade deficit fell 5.4 percent to $40.6bn in October. Exports jumped 1.8 percent to an all-time high of $192.67bn, pointing to a pick-up in global demand that should help to support domestic growth in the fourth quarter. Exports had declined for three straight months. Imports edged up a modest 0.4 percent to $233.3bn in October, the highest in one-and-a-half years.
Reuters
