US jobless claims back at four-year lows
Washington, March 15, 2012
The number of Americans claiming new jobless benefits fell back to a four-year low last week and manufacturing in the Northeast held up in March, providing more signs the US economy was firmly on a self-sustaining growth path.
Initial claims for state unemployment benefits dropped 14,000 to a seasonally adjusted 351,000, the US Labor Department said on Thursday. That took claims back to a four-year low reached in February.
Separately, the New York Federal Reserve said its Empire State general business conditions index rose to 20.21 - highest level since June 2010 - from 19.53 in February.
'This suggests that the recovery is firmly on track,' said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.
The reports were the latest to imply the economy was holding its own, even though the pace of growth was expected to slow this quarter from the the fourth quarter's 3.0 percent annualised clip.
Prices for US Treasury debt held losses suffered Wednesday after the claims data, which fell more than economists had expected. The four-week moving average for new claims, considered a better measure of labor market trends, was unchanged at 355,750.
First-time applications for jobless benefits have been tucked in a tight range since mid-February, a hopeful sign for the labor market, which has enjoyed three straight months of employment gains above 200,000.
The jobless rate held at a three-year low of 8.3 percent in February. The firming labor market tone was reinforced by the New York Federal Reserve survey showing factories increased employment this month, and the average workweek more than doubled.
While the Federal Reserve on Tuesday acknowledged the recent improvement in the labor market, it remained concerned with the still-high unemployment rate. The US central bank said it expected the jobless rate, which has declined 0.8 percentage point since August, to 'gradually' decline.
In a second report, the Labor Department said its seasonally adjusted producer price index increased 0.4 percent last month, quickening from January's 0.1 percent gain. Economists polled by Reuters had expected prices at farms, factories and refineries to rise 0.5 percent.
Wholesale prices excluding volatile food and energy costs rose 0.2 percent, moderating from January's 0.4 percent increase. While that was in line with economists' expectations, it was the third consecutive month of increases in core PPI. The Federal Reserve said on Tuesday the recent steep run-up in oil and gasoline prices would push inflation up only temporarily.
Overall produces prices were lifted by a 1.3 percent increase in energy prices after a 0.5 percent drop in January.
Food prices dipped 0.1 percent after falling 0.3 percent the prior month. In the 12 months to February, producer prices increased 3.3 percent, the smallest increase since August 2010, after advancing 4.1 percent in January.
Gasoline prices rose 4.3 percent, the largest gain in five months, after gaining 2.0 percent in February. Outside food and energy, producer prices were pushed up by pharmaceuticals, which accounted for a third of the increase in core PPI. A rise in prices for civilian aircraft also contributed.
Passenger car prices edged up 0.1 percent after falling 0.8 percent the prior month. Light motor trucks prices fell 0.4 percent after a 0.9 percent rise the prior month. In the 12 months to February, core producer prices increased 3.0 percent after rising by the same margin the previous month. - Reuters