* Weekly jobless claim drop 32,000, hit 7-year low
* Import prices up; food price surge largest in three years
* Claims data suggest acceleration in job growth
By Lucia Mutikani
WASHINGTON, April 10 The number of Americans
filing new applications for unemployment benefits tumbled last
week to the lowest level in nearly seven years, strengthening
views of faster job growth.
Thursday's report was the latest sign of momentum in the
economy after activity was hobbled by an unusually cold winter.
"The return of warmer temperatures has brought with it
better data. There are a number of signs that progress in the
jobs market could be accelerating, a positive sign for the broad
economy as well," said Jim Baird, chief investment officer at
Plante Moran Financial Advisors in Kalamazoo, Michigan.
Initial claims for state unemployment benefits dropped
32,000 to a seasonally adjusted 300,000 for the week ended April
5, the Labor Department said. That was the lowest level since
May 2007, before the start of the 2007-09 recession.
The report joined other indicators such as automobile sales
and employment data in suggesting the economy ended the
first-quarter on a stronger footing, positioning it for faster
growth in the April-June quarter.
First-quarter growth is expected to have braked sharply from
the fourth quarter's annual 2.6 percent pace, largely because of
the harsh weather and businesses placing fewer orders with
manufacturers while working off massive stockpiles accumulated
in the second half of 2013.
Growth was also seen crimped by the expiration of long-term
unemployment benefits, cuts to food stamps and weak exports.
First-quarter gross domestic product estimates range as low as
U.S. financial markets were little moved by the claims data.
Economists had forecast first-time applications for jobless
benefits falling to 320,000 for the week ended April 5.
The number of people still receiving unemployment benefits
after an initial week of aid for the week ended March 29 hit its
lowest level since January 2008.
"The rate of involuntary job losses slowed in early April,
which suggests we could have a further pickup in job growth in
April," said John Ryding, chief economist at RDQ Economics in
New York. "We think that the unemployment rate could fall faster
than the Federal Reserve expects over the next year."
Job growth averaged about 195,000 per month in February and
March, with the unemployment rate holding at near a five-year
low of 6.7 percent over that period.
There have also been improvements in other labor market
measures such as the short-term unemployment rate and job
openings, which economists say suggest labor market slack is
NO INFLATION PRESSURES
Still the recent job market upturn is unlikely to see the
Fed in a hurry to start raising interest rates when it wraps up
its monthly bond buying program later this year.
The U.S. central bank slashed overnight interest rates to a
record low of zero to 0.25 percent in December 2008 and pledged
to keep them low while nursing the economy back to health.
Minutes of its March 18-19 policy meeting published on
Wednesday suggested officials were not eager to start tightening
A second report from the Labor Department showed import
prices increased 0.6 percent last month after rising 0.9 percent
The increase exceeded economists' expectations of a 0.2
percent gain and was driven by food prices, which recorded their
largest advance in three years. Away from food, there was little
sign of a broader pickup in imported inflation.
In the 12 months through March, import prices fell 0.6
percent, pointing to continued weak imported inflation that is
helping to keep a lid on domestic price pressures.
"The U.S. can't import any inflation," said Chris Rupkey
chief financial economist at Bank of Tokyo-Mitsubishi UFJ in New
York. "If this is on the Fed's inflation dashboard, there are no
inflationary pressures to speak of coming in from overseas."
Last month, imported food prices jumped 3.7 percent, the
biggest rise since March 2011, after falling 0.7 percent in
February. Imported fuel prices rose 1.2 percent last month,
slowing from a 5.3 percent surge in February.
Stripping out food and fuels, import prices rose 0.2 percent
after slipping 0.1 percent in February.
The Labor Department report also showed export prices
increased 0.8 percent in March, the largest rise since September
2012. That followed a 0.7 percent advance in February. In the 12
months through March, export prices gained 0.2 percent.
(Reporting by Lucia Mutikani; Editing by Paul Simao and