The US economy added more jobs than expected in February, but the unemployment rate ticked higher.

The Labor Department said on Friday that nonfarm payrolls increased by 275,000. The market had forecast 200,000.

Job growth for January was revised downward from over 350,000 to 229,000.

The February unemployment rate edged up 0.2 points to 3.9 percent, the highest since January 2022.

The Federal Reserve said in its latest economic report released on Wednesday that the tight labor market, which has been driving inflation, has eased further.

Some market players say the latest figures support that view. And they say the Fed may start cutting interest rates this year.

Investors sold the dollar for the yen in New York on Friday, in anticipation of a shrinking rate gap between Japan and the United States.

The Japanese currency briefly rose to the mid-146 range against the US currency. That's the highest level in about a month.