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US jobless claims post first back-to-back increases since July

The data indicate that soaring coronavirus cases and fresh lockdowns are spurring a new wave of layoffs.
Image: Bing Guan/Bloomberg

Applications for US state unemployment benefits unexpectedly rose for a second straight week in the first back-to-back increases since July.

The data indicate that soaring coronavirus cases and fresh lockdowns are spurring a new wave of layoffs.

Initial jobless claims in regular state programs increased by 30,000 to 778,000 in the week ended November 21, according to Labour Department data Wednesday. Without adjustments for seasonal fluctuations, the figure rose by about 78,000 during the week, which coincides with the reference period for the monthly jobs report.

Continuing claims — the total pool of Americans on ongoing state unemployment benefits — fell by 299,000 to 6.07 million in the week ended November 14. But the number of Americans on an extended assistance program continued to increase, a sign that more people have exhausted regular state benefits.

The main figures compared with economists’ projections for 730,000 initial claims and 6 million continuing claims, based on the median estimates in Bloomberg surveys.

The consecutive increases in claims offer evidence that the coronavirus threatens to stall an economic rebound that was already moderating from a breakneck pace in the third quarter, with some economists predicting a contraction for the first quarter.

The job market faces additional hurdles as states and cities restrict business activity and hospitalisations spike.

“The continued weakness of the labour market is something that is going to drive the whole economy down,” Catherine Mann, global chief economist at Citigroup Inc., said on Bloomberg Television

Several states recorded significant increases in initial claims, led by Illinois, where Chicago issued a stay-at-home advisory starting last week. Michigan, Washington, New Mexico, California and Minnesota also reported higher filings.

US stock futures edged lower with 10-year Treasury yields after the report, while the dollar fluctuated.

Continuing claims for Pandemic Unemployment Assistance, which provides benefits to self-employed and gig workers, increased by about 466,000 to 9.15 million. The Pandemic Emergency Unemployment Compensation, which provides payments to the long-term unemployed, was used by 4.51 million Americans. Those two programs will expire at year-end, leaving many without government aid.

In other economic data released Wednesday:

  • US durable goods orders increased at a faster-than-expected clip in October, supported by demand for computers and metals, underscoring a manufacturing sector that continues to support the economy.
  • The economy expanded at a record 33.1% annualised pace in the third quarter, unrevised from the initial reading.
  • The US merchandise-trade deficit widened in October as imports reached the highest in more than a year, outpacing a gain in the value of exports.
  • Reports are due at 10 a.m. Washington time on personal income and spending, new home sales and consumer sentiment.
© 2020 Bloomberg

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Maybe Trump can consider himself fortunate to loos the election because I wouldn’t like to be in the shoes of the next president with this upcoming new corona-? scare and all the negative publicity and blaming techniques of these corona-? activists.

End of comments.

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