US jobs market remains bearish; Fed says recent economic data stronger
The number of US citizens filing new claims for jobless benefits unexpectedly rose last week, suggesting the labour market is healing too slowly to make much of a dent in the unemployment rate. However an official from the Federal Reserve said US economic data in recent weeks had improved.
Initial claims for state unemployment benefits rose 4,000 to a seasonally adjusted 372,000, the Labour Department said today. That was the highest level in five weeks.
The report on jobless claims did have a silver lining, however. The data covers the same week looked at by the government for its monthly measure of employment, and showed a slight drop in layoffs from the survey week last month, which is a mildly positive signal for hiring in August.
The four-week moving average for new claims, a measure of labour market trends, was 368,000 last week. That was a slight increase from the prior week, but still 2.1% lower than in the second week of July.
That week, the government surveyed employers and concluded 163,000 new jobs were created in July - an improvement from the prior three months though the unemployment rate still ticked higher to 8.3%.
Meanwhile St. Louis Federal Reserve President James Bullard watered down prospects that the US central bank was locked into easing monetary policy at its meeting next month, noting that economic data had improved.
Minutes of the Fed's July 31-August 1 meeting released on Wednesday had highlighted strong support among policy-makers for more action. But Bullard told CNBC television that the economic outlook had brightened since that meeting.
I do think that the minutes are a bit stale because we have some data since then that has been somewhat stronger, Bullard, who will be a voting member of the policy-setting committee next year, said in an interview.
Bullard also voiced unusually blunt criticism of Europe's response to the sovereign debt crisis in the Euro zone, saying he was pessimistic on the region's capacity to take robust action, but played down the impact on the United States so far.