Three Important Points About Today's Jobs Report

Janet yellenREUTERS/Gary CameronU.S. Federal Reserve Board Chair Janet Yellen testifies before the Senate Banking Housing and Urban Affairs Committee on Capitol Hill in Washington February 27, 2014.

The February Jobs Report just came out.

There are three things you should think about.

1) The Non-Farm Payrolls report was solid. This suggests that the economy was a bit stronger than we thought.

2) But the unemployment rate ticked up, which markets will like, since that gives the Fed some slack.

3) But there was a big gain in average hourly earnings (+0.4%), the strongest in a long time. This is a sign of a tightening labour force, which is something markets have been talking about lately, that the market is tighter than people realise.

Bottom line: A solid, goldilocks report that the market will like. But the average hourly earnings is a big story.

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