Surprise fall in US jobless rate
Fewer jobs are cut and unemployment falls but fears of US recession remain high.
The figures came two days after the US central bank cut interest rates by a quarter-point from 2.25 per cent to two per cent, the lowest rate since December 2004.
On the same day, government figures showed that the US economy had grown by a modest 0.6 per cent in the first three months of 2008.
This week the US government began making direct deposit rebates of up to $600 for individuals and $1,200 for couples as part of an economic stimulus programme approved by the US Congress earlier this year.
The US economy has been battered in recent months by tight credit conditions, high oil prices, the weak dollar and the ongoing subprime mortgage crisis, in which people were offered mortgage deals they could not afford to repay.
Analysts said that despite the job numbers marking an improvement on previous months concerns remained over the US slipping into a recession.
“The economy is just barely treading water,” Richard Yamarone, chief economist for Argus Research in New York, told the Reuters news agency.
“It’s not imploding but it’s not desirable either.”