US employers stepped up hiring in some parts of the country in October and early November as the economy expanded at a "modest to moderate pace," the country’s Federal Reserve has said.
The Fed's Beige Book, a collection of anecdotes from the central bank's business contacts across the nation, could bolster the view that the robust growth in payrolls in October carried over into November.
It also supports the view that the Fed is nearing the point where it will reduce monthly bond purchases aimed at propping up the labour market.
"Hiring showed a modest increase or was unchanged" across the country, according to the report, which was prepared by the Cleveland Fed with responses collected on or before 22 November.
The report said hiring accelerated in the Philadelphia, Richmond, St. Louis, Minneapolis, and Dallas Districts. Employment gains were steady elsewhere.
That is positive news ahead of Friday's more comprehensive report on job creation during November, which is expected to show a healthy increase of 180,000 positions.
The expected pace of hiring would be less blustery than the 204,000 jobs added in October, but is still seen as enough to lower the jobless rate by a tenth of a percentage point to 7.2.
The Fed says there were particular signs of rising economic activity in the car and high tech industries, and that staffing services were more optimistic than they were three months ago.
At the same time, many of the Fed's business contacts said they were worried an overhaul of the nation's health insurance system could raise costs for companies.
Earlier figures from the ADP National Employment Report showed that US private employers had hired more workers than expected in November.
Private employers added 215,000 new jobs to their payrolls last month, the report showed, beating economists' expectations for a gain of 173,000 jobs. October's gain was revised to 184,000 from 130,000.
The ADP data comes ahead of the US government's much more comprehensive employment report for November on Friday, which includes both public and private sector hiring.
That report is expected to show an increase of 180,000 in nonfarm payrolls, according to a Reuters poll of economists, down from 204,000 in October.
While the ADP report, which is jointly developed with Moody's Analytics, does not have a good track record predicting non-farm payrolls, it raises the risk of a stronger reading on Friday.
In a separate report, the Commerce Department said the nation's trade deficit fell 5.4% to $40.6 billion as exports hit a record high. That pointed to a pick-up in global demand that should help to support domestic growth in the fourth quarter.
Economists polled by Reuters had expected the trade gap to narrow to $40 billion in October.
When adjusted for inflation, the trade gap fell to $48.3 billion from $51.4 billion the prior month. This measure goes into the calculation of gross domestic product and suggested trade will again contribute to growth this quarter.
An improving global economy is boosting demand for US exports. In October, exports increased 1.8% to $192.7 billion. That was the highest on record and snapped three months of declines in exports in a row.
Petroleum exports were the highest on record in October. Exports to China hit a record high as did imports from that country. Still, the trade deficit with China narrowed in October.
China has been one of the fastest-growing markets for US goods, though the pace of export growth slowed in recent months.
Exports to Canada and Mexico also reached all-time highs in October. While exports to the European Union rose, they were outpaced by imports, resulting in a record trade deficit.
Overall imports rose a modest 0.4% to $233.3 billion in October, the highest in one and a half years. With consumer spending slowing significantly in the third quarter and stocks piling up in warehouses, businesses are probably wary of bringing in too many goods from overseas.
The slowdown in import growth could limit the drag on the economy from an anticipated inventory drawdown in the fourth quarter.
US new home sales surge in October
Sales of new US homes recorded their biggest increase in over 33 years in October, suggesting the housing market recovery remains intact despite higher mortgage rates.
The Commerce Department said that sales jumped 25.4% to a seasonally adjusted annual rate of 444,000 units. It also said new home sales fell 6.6% in September.
The release of both the September and October reports was delayed because of a 16-day partial shutdown of the government last month.
Economists polled by Reuters had expected new home sales to set a 428,000-unit pace last month. Compared with October last year, new home sales were up 21.6%.
The strong rise in new home sales, which are measured when contracts are signed, suggested higher mortgage rate had not derailed the US housing market recovery.
Higher mortgage rates have slowed the pace of home sales, but demand for accommodation as household formation continues to recover from multi-decade lows is keeping demand supported.
Home resales fell in October for a second month in a row and confidence among single-family home builders has ebbed somewhat since nearing an eight-year high in August.
Strong new home sales in October saw the stock of houses on the market falling 3.7% after touching their highest level in nearly three years in September. Despite the tight supply of properties, the median price of a new home slipped 0.6% from a year-ago.
