By Daniel Hunter

Employers in the US created 223,000 new jobs in April, significantly more than the month before.

The US Department of Labor said the unemployment rate dropped to a seven-year low of 5.4%, down from 5.5% in March.

The total was a big improvement on March's payroll figures, which were revised to show a gain of just 85,000 jobs.

Experts blamed factors such as the exceptionally cold winter in the North East for weighing on hiring in March. April's report also showed gains in employee wages, with average hourly earnings up 2.2% from the same period last year.

That rise could provide a boost to US consumer spending, a key driver of the US economy.

Investors are paying close attention to all figures to check that the US recovery is maintaining momentum.
The Federal Reserve is expected to raise interest rates later this year if the economy continues to improve. Benchmark lending rates are currently close to zero.

Marcus Bullus, trading director at MB Capital, commented:

"The bulls are back on both sides of the Atlantic.

"A stunning return to form for US jobs growth and a surprise victory for the status quo in the UK election have sent stocks skyward in both New York and London.

"With the US unemployment rate now at its lowest level since May 2008 and rates of job creation rebounding, the first quarter wobble increasingly seems just that - a brief interruption in the US economy's extraordinary run of job generation."