The number of Americans filing new claims for jobless benefits rose more than expected during the last week, but the trend remained consistent with sustained strength in the labor market.
Initial claims for state unemployment aid increased by 17,000 to a seasonally adjusted 298,000 by Dec. 27, according to the Labor Department, after four straight weeks of declines.
“The claims data still point to relatively upbeat conditions in the labor market through some of the ups and downs in the weekly figures,” said Daniel Silver, an economist at JPMorgan in New York.
Though last week’s increase was above Wall Street’s expectations for a rise to 290,000, claims numbers are very volatile around the Christmas holiday period.
The four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week unpredictability, rose only 250 to 290,750 last week. It remained below the 300,000 mark for 16 straight weeks.
“Companies are not laying off workers for weak demand recession conditions,” said Chris Rupkey, a chief financial economist at MUFG Union Bank in New York. “This means that unemployment will continue to fall at a fast rate.”
US stocks were trading marginally higher, while the dollar was little changed against a basket of currencies. Prices for US Treasury debt were slightly up.
A survey of consumers released on Tuesday, Dec. 30 by the Conference Board showed households in December were more upbeat than they had been in a few years about prospects of getting a job.
The government is expected to report next week that nonfarm payrolls rose over 200,000 in December after surging 321,000 in November, according to a Reuters survey of economists.
This is the 11th consecutive month of job gains above 200,000, the longest stretch since 1994. The unemployment rate is set to dip one-tenth of a percentage point to 5.7 percent, which would be the lowest rate since June 2008.
Other data on Wednesday, Dec. 31 showed factory activity in the Midwest cooled in December, and a slight rebound in contracts to buy previously owned homes in November. However, it did little to change perceptions about the year’s economy ending on solid footing.
The economy grew at its fastest pace in 11 years in the third quarter.
The Institute for Supply Management-Chicago Business Barometer fell to 58.3 in December from November’s reading of 60.8. A reading above 50, according to the Institute, indicates expansion in the region’s factories.
“While momentum moderated somewhat heading into year-end, the handoff to 2015 growth is likely to be quite positive,” said Gennadiy Goldberg, an economist at TD Securities in New York.
Separately, the National Association of Realtors’ pending home sales index, based on contracts signed in November, rose marginally by 0.8 percent.
(With reports from Reuters)
(www.asianjournal.com)
(LA Weekend January 3-6, 2015 Sec. D pg.1)
