New US claims for jobless benefits rose last week, hardening the view the central bank will pump more money into the economy, and keeping pressure on Democrats poised to lose congressional seats in 2 November polls.
At the same time, record-high imports from China helped push the US trade deficit wider in August, while rising food and energy prices pushed inflation at the wholesale level up twice as fast as expected last month.
Initial claims for state unemployment benefits rose to a higher-than-expected 462,000 in the latest week, the Labour Department said yesterday.
Economists polled had expected initial claims at 445,000 in the latest week.
“These numbers don’t fall out of the range of expectations, so they don’t move the needle too much,” said Jason Pride, director of investment strategy at Glenmede Investment and Wealth Management.
The number of unemployed workers continuing to collect insurance benefits fell 112,000 to 4.399m in the week ended 2 October, the lowest level since November 2008.
Prices for US Treasury securities were little changed after the data’s release. The US dollar briefly extended losses and stock index futures trimmed their gains.
In a separate report, the Labour Department said US producer prices rose 0.4 per cent in September and the core index, which excludes volatile food and energy prices, rose 0.1 per cent in the month.
The US trade deficit for August jumped 8.8 per cent to a larger-than-expected $46.4bn, pushed by record imports from China that helped the US deficit with Beijing set a new record of $28.0bn, the Commerce Department said.
The US growth outlook has darkened significantly and the Federal Reserve is unanimously expected to embark on a fresh round of asset purchases to prop up the economy, a separate Reuters poll showed.
City A.M. Reporter