Instant View: Job growth strong again in February

(Reuters) - Employment grew solidly for a third straight month in February, a sign the economic recovery was broadening and in less need of further monetary stimulus from the Federal Reserve.

GRAPHIC: http://link.reuters.com/dan96s

KEY POINTS:

* Employers added 227,000 jobs to their payrolls last month, the Labor Department said on Friday, while the unemployment rate held at a three-year low of 8.3 percent.

* It marked the first time since early 2011 that payrolls have grown by more than 200,000 for three months in a row - bolstering President Barack Obama's chances for re-election.

* The economy created 61,000 more jobs in December and January than previously thought, and the jobless rate held steady even as more people returned to the labor force.

COMMENTS:

ADAM BUTTON, CURRENCY ANALYST AT FOREXLIVE IN MONTREAL:

"This number confirms that U.S. employment continues on an upward trajectory, and it adds clout to those who are saying that QE3 is not the right option at this time. That said, there is some sentiment in the market that the unseasonably warm weather in February has skewed data across the board. We're seeing some U.S. dollar strength, and in stocks some further optimism about the economy, though that could be tempered by skepticism about weather-related effects."

STEWART HALL, SENIOR FX STRATEGIST, RBC CAPITAL MARKETS, TORONTO:

"Good numbers on both overall and private payrolls, and the icing on the cake are the fairly sizable upward revisions. Household job growth is still at relatively healthy levels and the climb in the participation rate is encouraging. It puts a floor under the unemployment rate but it's good to see people coming back into the workforce. For the market, it's still a bit of a Goldilocks scenario - the jobs number points to recovery but it's not so strong that it necessarily scotches quantitative easing, as you still can't characterize this job market as normal by any means."

CRAIG DISMUKE, CHIEF ECONOMIC STRATEGIST, VINING SPARKS, MEMPHIS, TENNESSEE:

"This is a healthy number. It confirms that the labor market is gradually improving. I also liked the revisions. All in all, it's really a positive report.

"The participation rate rose 0.2 percent which is the biggest monthly increase in two years. That's another positive sign. But there are still fundamental weakness in the labor market. Still the jobs market is showing steady improvement.

"It is a good enough number that you will see this would give some strength in stocks and some weakness in bonds.

"The last three months in payrolls in combination have likely delayed the Fed's implementation of QE3."

OMER ESINER, CHIEF MARKET ANALYST, COMMONWEALTH FOREIGN EXCHANGE WASHINGTON, D.C.

"It looks like a solid number pretty much across the board. We got a better-than-consensus reading for the headline number and there were some whisper numbers that were well below the 200,000 mark, so that's even better news than the better-than-expected number might suggest. I think we'll begin to spark debate about the Fed exiting its ultra-accommodative policy stance sooner than expected. I think if this trend continues then clearly there'll be a translation of good economic news to the outlook for Fed policy. I think that's going to be dollar supportive."

SEAN INCREMONA, ECONOMIST, 4CAST LTD, NEW YORK:

"This continues to show that job growth is going at an encouraging pace. Upward revisions to the previous month and a solid February keeps that positive sentiment alive. I don't really think this is a game-changing figure in itself, I think we are still in a moderate recovery and that we can continue job gains around this level, but it may be difficult to continue to gather momentum."

VIMOMBI NSHOM, ECONOMIST, IFR ECONOMICS, A UNIT OF THOMSON REUTERS:

"The employment picture in February was just as encouraging as January's surprise, with 227k jobs added to the economy in February. While the payrolls measure beat market expectations which thought payroll growth would slow to 210k, an unchanged unemployment rate of 8.3% in February matches forecasts predicting that entrants to the labor force would limit the percentage of employed, and thus hold the unemployment rate for the second month. Payrolls have risen by over 200k for the third straight month, making room for more analyses that the economic recovery is about to perform on its own (without government support) as more jobs bring about more demand and disposable income to perpetuate its own growth.

"Revisions added an additional 61k jobs to the labor market as January had 284k jobs(originally 243k) and December was revised up from 203k to 223k jobs. January's private payroll growth (now 285k from 257k)essentially represents January's labor market as government job losses were revised down to a decline of 1k from 14k. January services account for majority of the revision (from 149k to 202k) with nearly every industry revised higher, especially healthcare (from 29.7k to 43k), temp help (up 12k to 32.1k), and retail (up to 26.1k from 10.5k)."

MARKET REACTION:

STOCKS: U.S. stock index futures rallied on the news

BONDS: U.S. bond prices were steady at lower levels

FOREX: The dollar hit session highs against the euro and yen

(Americas Economics and Markets Desk; +1-646 223-6300)

Source: http://news.yahoo.com/instant-view-job-growth-strong-again-february-133546867.html

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