US jobless benefit claims fall to seven-month low
NEW US claims for jobless benefits hit a seven-month low last week and permits for future home construction rebounded strongly in October, according to new figures.
The improving economic picture was spoiled somewhat by another report yesterday, showing factory activity in the Mid-Atlantic region slowed this month on weak orders.
However, employers hired more workers and increased working hours.
"Economic conditions are moving upward at an accelerating pace," said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania. "However, two major roadblocks stand in the way of solid growth: rising oil prices and European debt issues."
Initial claims for state unemployment benefits fell 5,000 to 388,000, the US Labour Department said, pushing a four-week average below the 400,000 mark for the first time since April. The report covered the survey period for the government's employment count for November and offered hope that hiring accelerated this month after payrolls rose 80,000 in October.
First-time claims dropped 16,000 between the October and November survey weeks. The government will release its job count on December 2.
"We believe this decline could be heralding a pickup in the pace of job creation," said John Ryding, chief economist at RDQ Economics in New York.
"We do expect the report to show a pickup in employment growth along with a continued pattern of upward revisions to the prior two months."
The weak labour market, marked by a 9pc unemployment rate, has been one of the hurdles to stronger economic growth.
Outside the jobs market there were signs of stability in housing, with permits for home building soaring 10.9pc to a seasonally adjusted annual rate of 653,000 last month. While new construction fell 0.3pc to an annual rate of 628,000 units, economists believe residential building will soon contribute to growth as demand for rentals boosts the construction of apartment buildings. Last month, permits for buildings with five units or more rose to their highest level in three years.
The fairly upbeat data had little impact on Wall Street yesterday, where Europe's debt problems -- which could derail the recovery -- continued to dominate sentiment.
US stocks were lower in midday trade. Prices for Treasury debt were down and the dollar was little changed against a basket of currencies. (Reuters)