Job, Wage Growth Robust in March; Unemployment at 5.2%; Inflation Fears Deepen
The strong U.S. economy kept churning out jobs and lifting wages last month, pushing the nation's unemployment rate down to 5.2 percent, the Labor Department reported yesterday.</br></br>While workers obviously are benefiting from all the added jobs and higher wages, the report only heightened concerns among some investors, analysts and government policymakers that the pace of economic growth may be spurring inflation.</br></br>On that basis, Wall Street initially interpreted the economic numbers negatively, sending the most widely watched measure of stocks down nearly 72 points early in the day. But the market rallied later, with small company stocks and those of many technology companies showing particular strength. The widely watched Dow Jones industrial average of 30 blue-chip stocks closed at 6526.07, up almost 49 points from Thursday {Details on Page H2}. It had shed about 400 points in the previous five sessions.</br></br>Some analysts said yesterday's wage figures suggest that inflation already may be accelerating -- although the numbers themselves so far give no hint of it.</br></br>The Federal Reserve raised short-term interest rates last week by a quarter-percentage point in an effort to head off a rise in inflation. Rising interest rates slow economic growth by making it more expensive for businesses and consumers to borrow money. A number of analysts said yesterday's report suggests the Fed is likely to increase rates again at its next policymaking session May 20.