June 23, 2011 / 2:40 PM / 8 years ago

REFILE-WRAPUP 2-US jobless claims point to weak labor market

(Refiling to fix typo in third paragraph)

* Initial jobless claims rise 9,000

* Four-week average, continuing claims flat

* New home sales fall 2.1 percent in May (Adds new home sales, Chicago Fed index, updates markets)

By Lucia Mutikani

WASHINGTON, June 23 (Reuters) - The number of Americans filing new claims for unemployment benefits rose last week, suggesting little improvement in the labor market this month after employment stumbled in May.

Initial claims for state unemployment benefits climbed 9,000 to a seasonally adjusted 429,000, the Labor Department said on Thursday. Economists had expected claims to come in at 415,000.

The report covers the survey period for the government’s closely watched data on nonfarm payrolls for June, which will be released on July 8.

Claims increased 15,000 between the May and June survey periods, implying another soft month for jobs in June after a modest 54,000 increase in payrolls in May.

“Again no quick rebound in employment. We’re still in the soft patch that we have had for a couple of months now,” said Sean Incremona, an economist at 4CAST in New York.


A second report from the Commerce Department showed new single-family home sales fell for the first time in three months in May, but inventories of new houses on the market hit record lows.

New home sales fell 2.1 percent to a seasonally adjusted annual rate of 319,000. Analysts polled by Reuters were expecting a slightly slower pace of 310,000 for the month.

U.S. stocks fell, while prices for Treasury debt advanced. The dollar rose against a basket of currencies.

A Labor Department official said technical problems had resulted in claims for six states being estimated last week.


INSTANT VIEW - US weekly jobless claims [ID:nN1E75M04R]

Graphic - U.S. jobless claims, year to date:



The claims data is the latest in a series of economic reports to underscore the weakness in the economy, which has persisted through the second quarter.

Separately, the Chicago Federal Reserve’s national activity index stayed in negative territory again in May, indicating the economy continues to grow below trend.

Growth has been crimped by high gasoline prices, but steps by the International Energy Agency on Thursday to release 60 million barrels of oil from strategic government stockpiles held by industrialized consumer nations should ease the pressure on consumers.

The Federal Reserve on Wednesday acknowledged the slowdown, but said it should largely be temporary. Although it cut its growth forecasts and downgraded its view of the labor market, it gave no indication of further monetary support.

The U.S. central bank confirmed it was winding up its $600 billion bond-buying program at the end of June.

“Over the course of the next few weeks and few months we will definitely be able to pin this down, but our base case is that we will crawl out of this and chug along with a moderate recovery,” said Incremona.

The four-week moving average of new jobless claims, considered a better gauge of labor market trends, was unchanged at 426,250.

Initial claims have now been above the 400,000 mark for 11 weeks in a row. Analysts normally associate that level with a stable labor market.

The number of people still receiving benefits under regular state programs after an initial week of aid was little changed at 3.70 million in the week ended June 11.

Economists had expected so-called continuing claims to nudge down to 3.67 million from a previously reported 3.68 million.

The number of people on emergency unemployment benefits rose 5,728 to 3.30 million in the week ended June 4, the latest week for which data is available. A total of 7.54 million people were claiming unemployment benefits during that period under all programs. (Reporting by Lucia Mutikani, Additional reporting by Chris Reese in New York; Editing by Andrea Ricci and Neil Stempleman)

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