Weekly Jobless Claims Rise Unexpectedly
Less than three weeks from the November elections, economic reports showed a weakening economy, further dampening efforts by President Barack Obama to convince voters that the economy “is on the right track.”
From The Americano
Less than three weeks from the November elections, economic reports showed a weakening economy, further dampening efforts by President Barack Obama to convince voters that the economy “is on the right track.”
The Associated Press (AP) said that the most recent blow came Thursday when the Labor Department said applications for unemployment benefits rose by 13,000 to a seasonally adjusted 462,000 — the first increase in three weeks.
“I don’t expect to see really strong employment growth … until the second half of next year,” Gus Faucher, an economist at Moody’s Analytics told the AP.
Reuters reported Thursday that unexpected rise in new claims for jobless benefits hardened the view the central bank will pump more money into the economy in hopes of boosting growth and lowering unemployment.
At the same time, the agency reported that record-high imports from China helped push the U.S. trade deficit wider in August, which could drag on U.S. growth and increase international tensions over trade and currency policy.
“We are basically plodding along at subpar growth. Overall, the whole data set is disappointing,” Omair Sharif, an economist with RBS Securities in Stamford, Connecticut, said in the Reuters story.
The story added that the weak economic data kept the pressure on President Obama’s Democratic party, which looks likely to lose control of the U.S. House of Representatives in the November 2 elections.
The British news agency asserted this because a joint Reuters-Ipsos poll projected on Wednesday that Republicans would win a majority in the U.S. House of Representatives. That poll also said that Republicans would not gain the 10 Senate seats the party needs to get control of the U.S. Senate. .
Initial claims for state unemployment benefits rose to a higher-than-expected 462,000 in the latest week, the Labor Department said on Thursday.
“Job growth is still weak and layoffs will continue,” economist Christopher Low at FTN Financial in New York told Reuters.
And, according to the U.S. Commerce Department, the U.S. trade deficit for August jumped to a larger-than-expected $46.4 billion as the shortfall with China hit a record $28.0 billion.
Reuters reported that forecasting firm Macroeconomic Advisers said it cut its forecast for third-quarter U.S. GDP growth by four-tenths of a percentage point to 1.2 percent on the back of the trade report.
The story added the U.S. economy slowed sharply in the second quarter, weighed down by a hefty trade gap and dwindling fiscal stimulus and the housing sector, which was at the center of the deepest recession since the Great Depression, continues to struggle.
RealtyTrac said on Thursday that the number of U.S. homes taken over by banks topped 100,000 for the first time in September, though foreclosures are expected to slow in coming months as lenders work through questionable paperwork, real estate data company.
Many economist are now worried a “de facto” moratorium on mortgage foreclosures may have on an already troubled economy.
Reuters said that a poll it had conducted on economists Thursday, “showed economists’ outlook had darkened significantly over the past month, and they unanimously agreed the Fed would embark on a fresh round of asset purchases to prop up the economy and keep the inflation rate from drifting lower, likely as soon as next month.”
The Americano / Agencies
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