Positive US jobless data gives hope

Tim Wallace
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US ECONOMIC growth for the second quarter was revised up while initial jobless claims dropped, according to US data out yesterday.

The Bureau of Economic Analysis revised second quarter annualised growth up from one per cent to 1.3 per cent. Economists are warning that much of the increase on the previous quarter, which recorded growth of just 0.4 per cent, comes from federal government spending rather than confident consumers.

Meanwhile, the number of new unemployment benefit claimants in the week ending 17 September fell by 37,000 compared with the week before, from 428,000 to 391,000.

The advanced number for insured unemployment was 3.729m, down 20,000 on the previous week on a seasonally adjusted basis. That gives a rate of three per cent.

Analysts are warning that the jobless statistics may be revised up, however, due to a measurement error.

“The fall in initial jobless claims to 391,000 last week from 423,000 the week before may not be as encouraging as it looks,” said Capital Economics’ Paul Dales.

“The Department of Labor stated that at least part of the decline may be due to a ‘slight mis-timing’ in the seasonal adjustment factors. Further falls will be needed before we can conclude a downward trend is underway.”