Faster Fed taper, earlier rate hikes in sight as unemployment falls

Federal Reserve policymakers look likely to accelerate the winding down of their bond-buying program when they meet later this month as they respond to a tightening labor market and move to open the door to earlier rate hikes than they had projected.

US employers added 210,000 jobs last month, a U.S. Labor Department report showed Friday, less than half of what economists had expected. But average hourly earnings over the past 12 months rose 4.8%, the unemployment rate dropped to 4.2%, and the workforce grew by the most in 13 months. Analysts said they believe the moderate job gains understate labor market strength and that they would likely be revised upward.