U.S. Unemployment Rate Falls to 8.6%

The U.S. unemployment rate fell to 8.6 percent in November as the economy added 120,000 jobs to the workforce. Adding to the robust results was a revision of the September and October Non-Farm Payroll Reports that added another 72,000 jobs to the totals.

The news will obviously be well-received by the markets but it is clear much work remains to return to the pre-recession employment numbers. There also remains the European debt crisis and the potential to dampen the recovery. There is also the potential for a tightening of U.S. fiscal policy in the new year that could lead to slower growth.

For these two reasons in particular, analysts have not ruled out further quantitative easing on the part of the Federal Reserve. Fed Chairman Ben Bernanke has made it clear that the ultra-low interest rate will remain while refusing to rule out further buying of bonds.

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