US Jobless Claims: 374K – A Slight Disappointment

The number of weekly unemployment claims in the US stands at 374K. A figure of 370K was expected. Continuing jobless claims now stand on 3.316 million, higher than 3.307 million that was expected but lower than the updated figure of 3.321 million last week.

EUR/USD was trading steadily around 1.2550 and USD/JPY was around 78.60 before the publication. The initial reaction is a slightly weaker dollar against both these currencies. Update: EUR/USD now turning around and falling.

According to the initial report last week, claims stood on 372K. This was now revised to the upside: 374K.

The level of 400K claims is considered to be the limit between a rising unemployment rate to a dropping one. Levels were lower during the first quarter before rising in Q2 and falling to current levels around July.

Personal spending rose by 0.4% as expected and personal income rose by 0.3%, below the expected rise of 0.4%. The Core PCE Price Index was predicted to see a rise of 0.1% but remained unchanged.

US figures released in August have been good enough to prevent another immediate dose of quantitative easing. The meeting minutes implied that the Fed was ready to ease, in order to counter the slowing recovery and the dire employment Since then (August 1st), jobless claims, Non-Farm Payrolls and housing have all shown positive signs.

At the annual Jackson Hole Symposium, Bernanke will a chance to provide hints about future policy. He hinted about QE2 in this same place in 2010, but refrained from saying anything of importance in 2011.

See more:  QE3 in September? – Certainly NOT a Done Deal