The February jobs report showed that the US economy added 311,000 jobs and the unemployment rate increased to 3.6%.
Wage gains slowed to 0.2% from 0.3% in January.
While the strong report signals continued momentum in the US economy, slower wage growth and an easing in the jobs market may prompt the Federal Reserve to be less aggressive in their planned interest rate hikes.
The expected March 21-22 half-percentage point rate hike may be tempered by the slower wage growth.
The US added 311,000 jobs in February, exceeding expectations, and continuing the trend of strong hiring that has characterised the US labour market.
However, wage growth slowed, and the unemployment rate ticked up to 3.6% in February.
While the strong gains could lead to more aggressive Federal Reserve rate hikes, the cooling jobs market could prompt the Fed to reconsider.
According to Sal Guatieri, an economist at BMO Capital Markets, "The jobs report suggests the economy has a little more momentum than previously thought and companies are still keen on hiring, which is not what the Fed wants to hear.
" However, Omair Sharif, of Inflation Insight, stated that the jobs report was "a pretty good one for the Fed, and that it "screams soft landing".
Despite these comments, the rate hike is still expected.
On Wednesday, Federal Reserve Chair Jerome Powell caveated his hawkish message of a still-rising rate horizon by emphasizing the decision still hinged on February job and inflation data, causing futures markets to decrease their odds of a half-percentage point hike to 80% from the previous 100% priced in.