The U.S. jobless rate fell two-tenths of a per cent in January to 5.2 per cent, its lowest level since September of 2001.

However, growth in new jobs was disappointing. The U.S. Labour Department said the economy added 146,000 new jobs. Analysts had expected payroll growth to be 189,000 positions.

Payrolls have increased by an average of 137,00 in the past three months, according to the department, a slow down from the 181,000 average pace for all of 2004.

Manufacturing and construction jobs declined by a total to 31,000, including 25,000 lost factory jobs. Jobs in the services increased by 177,000, including 19,000 in retail. Government employment rose by 12,000 workers.