US jobless claims lowest since '08 on growth spurt
Published 16/12/2011 | 05:00
The fewest workers in three years filed claims for US jobless benefits last week, indicating the world's largest economy is strengthening heading into 2012.
The number of applications for unemployment payments dropped by 19,000 to 366,000 in the week ended December 10, less than the lowest forecast of economists surveyed by Bloomberg News and the least since May 2008, according to Labour Department figures issued yesterday in Washington.
Other reports showed manufacturing accelerated this month after pausing in November.
"The US economy, unlike the rest of the world, is gathering momentum as we head toward year-end," said Eric Green, chief market economist at TD Securities in New York.
"The labour market is improving sharply," he said, "and we look for gains in industrial production."
A reduction in firings may pave the way for an increase in employment that will help spur consumer spending, which accounts for about 70pc of the economy. Lean inventories and growing demand may probably spark gains in production that will keep factories at the forefront of the expansion.
The S&P's 500 Index rose, snapping a three-day drop, on the improving economic outlook. The gauge climbed 0.6pc to 1,218.71 in New York.
Manufacturing may contract this month from China to the euro region as global demand slows and Europe's leaders struggle to contain the worsening debt crisis, reports yesterday showed.
Chinese factory output looks set to decline for a second month in December as Europe's fiscal woes weigh on exports and home sales slide, results from a Markit Economics survey indicate.
In the euro area, manufacturers face a fifth straight month of contraction as the region endures its worst quarter for two-and-a-half years, another report showed.
The manufacturing improvement helped ease concerns that factory demand was cooling after another report from the Fed showed industrial production dropped in November for the first time in seven months. Output at factories, mines and utilities declined 0.2pc after a 0.7pc gain in October.
Economists forecast a 0.1pc advance, according to the median estimate in a Bloomberg survey.