The headline non-farm payrolls increase of 155,000 was within spitting distance of the consensus 152,000 expectation, though the market may have been hoping for an upside surprise given recent ADP figures in excess of 200,000. This employment report leaves expectations for future Fed policy broadly unchanged. That said, even at 7.8%, we believe that the unemployment rate may well threaten the Fed’s 6.5% line in the sand earlier than mid-2015, which seems to be the Fed’s own expectation. 1.51pm GMT US jobs growth on target at 155,000 The US jobs market was steady in the run up to Christmas, with the number of non farming jobs up 155,000 in December. The growth was in line with the 150,000 forecast by a Reuters poll of economists. November's figures were revised up from a growth of 146,000 to 161,000, suggesting the job market recovery may be slowing. There were a total of 12.2m people out of work, according to the US Bureau of Labor Statistics, with the unemployment rate largely unchanged since September, still stubbornly above the 6.5% Federal Reserve target. Last month, the central bank said it would keep interest rates near zero until its unemployment target is met, and as long as inflation does not rise above 2.5%. Unemployment rates for women (7.3%) and blacks (14%) edged up in December, while rates for adult men (7.2%) teenagers (23.5%), whites (6.9%) and Hispanics (9.6%) showed little or no change. The number of long term unemployed was essentially unchanged at 4.8m and accounted for 39.1% of those out of work. Average hourly earnings for all non farm employees rose by 7 cents to $23.73, meaning over the year average hourly earnings rose by 2.1%. Justin Wolfers, economics professor at the University of Michigan, had this to say:

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