The US economy may be stumbling, but it is still standing. That was the message from two economic reports that pointed to a weak labor market but also a better performance on trade that should boost third-quarter gross domestic product. The number of Americans filing new claims for jobless benefits rose unexpectedly last week, further evidence of an anemic employment picture just hours before President Barack Obama unveils a plan on job creation in a major address to Congress.
Still, a considerably narrower trade deficit for July offered a ray of hope for economic growth in the third quarter following a sluggish first half of the year. Applications for unemployment benefits rose to 414,000 in the week ending September 3 from an upwardly revised 412,000 the prior week, the Labor Department said on Thursday. Wall Street analysts had been looking for a dip to 405,000. “Jobless claims numbers have been stabilizing in recent weeks. We’re probably seeing an economy that’s just growing slowly,” said Gary Thayer, chief macro strategist at Wells Fargo Advisors in St.
Louis US stocks were little changed as investors looked ahead to Obama’s address while Treasury debt was slightly higher and the dollar was up. A deteriorating global economic outlook prompted the European Central Bank to leave interest rates on hold, even as markets ratcheted up the pressure on the Federal Reserve to ease monetary policy further at its Sep 20-21 meeting. Excluding one week in early August, jobless claims have held above 400,000 since early April.
