There were less Americans who filed for unemployment benefits last week. Analysts saw this as a sign that the labor major has been improving after hiring increased in July. Jobless claims decreased by 6,000 to 361,000 in the week that ended August 4 according to the report released by the Labor Department.
A recent survey made by Bloomberg News of 43 economists showed that they forecast an average increase to 370,000. But not everything is positive for the US economy. Consumer confidence dropped to a two month low as home prices soared the most since 2006.
The drop in firings indicated the job market is improving after payrolls increased last month by the most since February of this year. The US economy needs higher gains in employment to prevent the upcoming fiscal cliff as well as the European debt crisis from disrupting the economic growth.
Most stocks increased and gave Standard & Poor’s 500 Index its longest rally since March. It advanced less than 0.1 percent to 1,402.8 during the closing in New York. The economic slowdown in Europe reduced Britain’s exports in the second quarter. It resulted into a record trade deficit.
China’s inflation and industrial production growth cooled in July. The central banks in South Korea and Japan saw little sign of price pressures. This underscored the scope for the monetary stimulus if the European crisis gets worse.
The economists surveyed by Bloomberg estimated jobless claims in the United States to increase to 359,000 to 385,000. The Labor Department revised its previous week’s number up to 367,000 from 365,000. According to a Labor Department spokesman, the data is not influenced by the yearly auto plant retooling closures, which make it hard to adjust the data for seasonal variations. The employment report for July released last week showed 163,000 employees were added to payrolls last month. It followed an increase of 64,000 in June.