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More positive signs from US economy

US private sector jobs - Figures better than expected
US private sector jobs - Figures better than expected

Two separate sets of figures have added to the view that the US economic recovery is gaining momentum.

One report showed that the US service sector grew in December at its fastest pace in more than four years, while another showed a surprise surge in private sector employment.

The Institute for Supply Management said its index of national services activity rose to 57.1 in December from 55 in November, above expectations. Any figure above 50 indicates growth.

The December reading was the highest since in May 2006. The report's employment component fell to 50.5 from 52.7 in November while new orders, a leading indicator, jumped to 63 from 57.7.

A report from ADP Employer Services showed that US private employers added 297,000 jobs in December, triple the figure expected by most economists and better than a gain of 92,000 in November.

The US government's much more comprehensive labour market report is due on Friday. That report, which includes both public and private sector employment, is expected to show a rise of 140,000 in December.

Adding to the rosy employment picture, the number of planned lay-offs at US firms fell last month to the lowest level in 10 years, according to a report by consultants Challenger, Gray & Christmas.