Unemployment Rate Rises to 4.4% As Economy Loses 92,000 Jobs

The U.S. unemployment rate increased to 4.4% in February, up from 4.3% the month before, signaling a softening in the domestic labor market.

The weaker-than-expected report from the Bureau of Labor Statistics released on Friday showed that nonfarm payrolls decreased by 92,000—a stark contrast to January’s surprise gain of 130,000 jobs.  

The segments of the job market that saw major losses in February included healthcare, information and federal government.

Realtor.com® senior economist Jake Krimmel says that despite this uptick in unemployment, the Federal Reserve is likely to maintain its pause on interest rate cuts until inflation starts cooling.

With core PCE, the Fed’s preferred inflation gauge, stuck at 3%, policymakers on the Federal Open Market Committee (FOMC) appear to have turned their focus to the price-stability side of its dual mandate.

"New voices on the committee, such as Beth Hammack, have already signaled the need for an extended pause to ensure inflation doesn't become entrenched," says Krimmel.  

Markets are currently pricing in a 95% chance that the Fed stays put during the next FOMC meeting this month, meaning borrowers should not expect any near-term mortgage interest rate relief from the central bank.

This is a developing story. Please check back for updates.