United States hit with highest jobless rate in two years: report

The unemployment rate in the United States has edged up to 3.9%, which is the highest it's been in two years, the BBC reported citing the Labor Department's latest report.

However, the report also shows that employers added 275,000 jobs, which is more than expected. The report is being closely monitored to gauge how well the country's economy is coping with the recent surge in borrowing costs.

While the latest numbers are sending mixed signals, most analysts agree that there's little in the report that should cause significant concerns or fears about the economy being affected by higher interest rates.

"Overall things still looking good," said Josh Furman, a former economic advisor to Barack Obama and a Harvard professor, on social media.

He added that the latest figures tilted the "balance of worry ever so slightly away from inflation and towards recession".

Healthcare firms, government, bars, and restaurants drove job gains in February, though the Labor Department reported a 167,000 lower increase in January and December compared to previous estimates.

The jump in the unemployment rate was due to an estimated 334,000 more people reporting being out of work, however, the rate remained low by historic standards and more people also entered the labour force.

Average hourly pay increased by 4.3% in February, a slight 0.1% increase from the previous year. 

Since 2022, the Federal Reserve has increased rates to combat rising price inflation, aiming to slow the economy and reduce demand pressures.

Despite some analysts predicting a severe downturn due to rising borrowing costs, the Fed has managed to avoid it.

Seema Shah, chief global strategist at Principal Asset Management, said the latest figures were "all over the place".

"Taking a big step back, the broad jobs report is somewhat market-positive," she said. "The [Federal Reserve] does, however, still need to tread cautiously."