U.S. Jobless Claims Remain Low Even With Biggest Rise in a Month
U.S. jobless-benefit claims remain low despite an increase last week, with the labour market otherwise exhibiting signs of continued tightening, Labour Department data showed Thursday.
HIGHLIGHTS OF JOBLESS CLAIMS (WEEK ENDED MAY 27)
- Initial filings increased by 13k to 248k (est. 238k)
- Continuing claims decreased by 9k to 1.915m in week ended May 20 (data reported with one-week lag)
- Four-week average of initial claims, a less-volatile measure than the weekly figure, rose to 238k from 235.5k in the prior week
Despite the increase in the headline figure, which was the largest in a month, the number of Americans filing for benefit claims continues to hover near a 43-year-low. Last week’s data had an unusually large portion come from estimates, as eight states including California and Texas — the two most populous — had approximated figures ahead of the Memorial Day holiday. The labor market probably registered another solid performance last month, with a projected 180,000 additions to payrolls and the unemployment rate holding at a decade-low of 4.4 percent. The Labor Department releases those monthly figures for May on Friday.
- Previous week’s initial claims revised to 235,000 from 234,000
- Unemployment rate among people eligible for benefits remained unchanged at 1.4 percent
- The eight states with estimated figures also included Hawaii, Kansas, Kentucky, Louisiana, North Dakota and Virginia
China stumps market, pushes yuan to 7-month highs
China’s yuan surged to a near seven-month high on Thursday, reinforcing views that the central bank will no longer tolerate much depreciation against the dollar and is setting the currency on a firmer path. Spot yuan strengthened through 6.8 per dollar for the first time since Nov.11 in early trade before retreating and settled at 6.8061 by the close of trade in China. The 4:30 p.m. settlement price was still nearly 0.2 percent firmer than the previous late session close. Early in the day, the central bank pushed the reference rate for the yuan up by 0.8 percent, the midpoint’s second largest one-day appreciation since the currency was de-pegged from the dollar in 2005. After months of holding the yuan relatively stable against the dollar, China has suddenly allowed the currency to advance about 1.2 percent since May 24, when Moody’s Investors Service downgraded its sovereign credit rating for the first time since 1989. Some traders believe the gains have been engineered as a show of strength by China to scare off short sellers after the downgrade, while others think the policy shift may have been in the works for some time to fix a flaw in the fixing mechanism which left the currency more susceptible to depreciation.
Euro zone manufacturing surges in May as new orders mount up
Manufacturing across the euro zone grew at the fastest rate in more than six years during May, increasing activity as price increases failed to slow their new orders, a survey showed on Thursday. Signs the bloc’s economy is enjoying a stable and broad-based recovery, alongside inflationary pressures, will be welcomed by policymakers at the European Central Bank. IHS Markit’s Manufacturing Purchasing Managers’ Index for the euro zone rose to 57.0 in May, up from April’s 56.7 and its highest level since April 2011. The figure matched a preliminary reading. An index measuring output, which feeds into a composite PMI due next week, also climbed further above the 50 mark that separates growth from contraction. It reached 58.3, its highest in more than six years high, up from April’s 57.9. “The euro zone upturn is developing deeper roots as factories enjoy a spring growth spurt,” said Chris Williamson, chief business economist at IHS Markit. “Demand for goods is growing at the steepest rate for six years, encouraging manufacturers to step up production and take on extra staff at a rate not previously seen in the two-decade history of the PMI survey.”