Bloomberg.com: U.S. Economy: Job Growth at Weakest Pace Since 2003 (Update1)

[Amerigo Vespucci]

http://www.bloomberg.com/apps/news?pid=20601087&sid=aqz8NTw6DVWo&refer=home

Jan. 4 (Bloomberg) -- Hiring in the U.S. slowed more than forecast in December and unemployment jumped to a two-year high, raising the odds that the Federal Reserve will cut interest rates by half a point this month to ward off a recession.

Payrolls rose by 18,000, capping the worst year for job creation since 2003, the Labor Department said today in Washington. The jobless rate increased to 5 percent from 4.7 percent in November, while the Institute for Supply Management said growth in U.S. service industries cooled last month.

Treasuries rallied, the dollar fell and stocks slid after the jobs report indicated more damage to the economy from the housing slump and reduced access to credit. The figures may also strengthen calls for President George W. Bush to stimulate the economy during his final year in office.

``It's time for the Fed to step up to the plate and let the public know how they're going to play this,'' said Maury Harris, chief economist at UBS Securities LLC in New York. ``This is a very vulnerable economy right now.''