There was some good news for the storm-torn US today as initial jobless claims fell to 363,000 – an unexpected drop of 9,000 from the previous week.
Economists participating in a Bloomberg News survey only forecast a decline of 2,000 but the far stronger number could indicate that demand is being bolstered enough to maintain present staffing levels. However, economists are still predicting that tomorrows Non-Farm Payrolls data will show the overall jobless rate increasing from 7.8 per cent to 7.9 per cent.
A strategist with TD Securities Inc. commented ‘Claims have been on a mildly improving trajectory. We’re definitely getting fewer firings, but hiring’s are picking up very gradually, and that’s why you’re only seeing gradual improvement in the labour market’.
According to the Labour Department’s report this week’s high decline from 372,000 took the initial jobless claims figure to a three-week low, although statistics for the District of Columbia and New Jersey had to be estimated due to Superstorm Sandy. The less volatile four-week moving average recorded a decline of 1,500, from 368,750 to 367,250.
Productivity also saw a notable increase with the measure of employee hourly output rising 1.9 while labour expenses fell at a pace of 0.1 per cent.
Any knock-on effects to the labour market from Superstorm Sandy are not likely to be known for several weeks.
ADP Research Institute released a separate report which detailed that in October companies extended payrolls by the most for 32-weeks – a strong hint that the US labour market began the fourth quarter on the up.
As of 13:35 pm
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