U.S. Job Growth Provides Dovish Boost Despite Higher Unemployment

The U.S. economy added 151,000 nonfarm payroll jobs in February, a figure that was lower than the 159,000 forecast but marked an improvement from the revised January total of 125,000, according to data from the Bureau of Labor Statistics released on Friday. The unemployment rate edged up to 4.1%, slightly above January’s 4.0% level, while average hourly wage growth moderated to 0.3% month-on-month, down from 0.4% and in line with expectations.

Analysts at Vital Knowledge described the payroll figure as a “tiny boost to growth sentiment,” noting that both wage growth and the unemployment rate moved in a dovish direction. These trends may influence the Federal Reserve’s future interest rate decisions, especially as policymakers continue to assess the economic impact of President Donald Trump’s trade and immigration policies.

Investors will be closely watching remarks from Fed Chair Jerome Powell later in the day. In January, the Fed opted to pause its rate cutting cycle, citing a relatively resilient jobs picture coupled with uncertainty over the inflationary effects of current fiscal and trade policies. The latest labor data further reinforces the Fed’s cautious, wait-and-see approach toward future adjustments in borrowing costs.