The US unemployment rate fell to a seven-month low in September even as payrolls shrank, according to a Labour Department report released yesterday that sent mixed signals about the state of the economy.The survey of households found the unemployment rate inched down from 5.7 per cent to 5.6 per cent in September, with a total of 8.1 million unemployed.

But the survey of businesses, published in the same report, painted a different picture. It said the number of payrolls outside the agricultural sector fell by 43,000 in the month the first decline since April and the biggest since February. It also showed an unusually sharp upward revision to job growth in August, from 39,000 to 107,000 the strongest pace of job creation since November 2000, suggesting a recovery that was gaining momentum before it succumbed to apprehension.

The household and payroll surveys occasionally send conflicting signals, especially around turning points, but tend to track each other over time. - (Financial Times Service)