WASHINGTON. Apr 3: The US unemployment rate dropped to its lowest level in nearly three decades in March but the roaring economy showed signs of a lowing as new jobs grew at an anaemic pace, the Labour Department said here, reports Reuters.

The jobless rate slid to 4.2 per cent from 4.4 per cent in February. The March rate was the lowest since a matching 4.2 per cent rate in February 1970 but the number of workers on US payrolls grew last month by a light 46,000 the weakest showing since a blizzard' in January 1996 caused payrolls to drop by 88.000.

US economists in a Reuters survey had expected payrolls to rise by 166.000 and the unemployment rate to dip to 4.3 per cent.

The bond market applauded the signs that the economy was

cooling off. in hopes that would keep any inflation pressures in check, bond prices mostly firmed on the data's release while the dollar barely reacted in light trading as many market makers were off due to religious holidays. Major US stock markets were closed here.

One bright spot in the payroll figures was an upward revision to the February job gain bringing it to 297.000 from a previously reported 275,000. Helping to drag down payroll growth in March was a steep decline of 47,000 in construction jobs which the Labour Department blamed on cold weather.

"March construction hiring fell short of seasonal expectations in part because of unseasonably cold weather in many areas of the country during the survey reference period," said Katharine Abraham, Commissioner of the Labour Depart-

ment's Bureau of Labour Statistics.

Abraham noted that prior to March, the construction sector had been enjoying brisk Job growth, both because of the robust housing market and because the earlier winter months had been relatively mild. That meant the builders already had plenty of workers on their payrolls.

The manufacturing job market contracted for a seventh straight month, the loss of 35,000 positions in the sector ran counter to a private survey released on Thursday from the National Association of Purchasing Management suggesting that the sector was starting to recovery from its export related slump.

The much watched NAPM index rose to 54.3 from 52.4 in February. A reading above 50 suggests industry is expanding.