U.S. jobless claims drop to more than 44-year low
The number of Americans filing for unemployment benefits fell to its lowest level in more than 44 years last week, pointing to a rebound in job growth after a hurricane-related decline in employment in September. Initial claims for state unemployment benefits dropped 22,000 to a seasonally adjusted 222,000 for the week ended Oct. 14, the lowest level since March 1973, the Labor Department said on Thursday. Data for the prior week was revised to show 1,000 more applications received than previously reported. The decrease in claims was the largest since April and was probably exaggerated by the Columbus Day holiday on Monday. Claims are declining as the effects of Hurricanes Harvey and Irma wash out of the data. Harvey and Irma, which lashed Texas and Florida, boosted claims to 298,000 in early September. A Labor Department official said claims for the Virgin Islands and Puerto Rico continued to be impacted by Irma and Hurricane Maria, which destroyed infrastructure. As a result the Labor Department continued to estimate claims for the islands.
China’s central bank warns of ‘Minsky moment’ as economy powers ahead
China’s central bank chief on Thursday issued a stark warning about asset bubbles in the world’s second-largest economy, which looks set to clock its first acceleration in annual growth since 2010, driven by public spending and record bank lending. Speaking on the sidelines of the closely-watched, twice-a-decade Communist Party Congress, People’s Bank of China Governor Zhou Xiaochuan spoke of the risks of a “Minsky moment” in the economy, referring to a sudden collapse in asset prices after long periods of growth, sparked by debt or currency pressures. Zhou’s comments refer to a theory on prices derived by American economist Hyman Minsky and follow official data that showed China’s economic growth slowed in the third quarter from a year earlier, as expected, but remained on track to post the first full-year pickup in seven years. Coming on the 30th anniversary of the Black Monday Wall Street crash, the comments from the governor, who is likely to retire soon, echo concerns expressed in the past by international economic bodies about relative levels of corporate and household debt in the economy. But while hedge funds sometimes refer to Minsky in warnings about a China credit bubble threatening the global economy, China has so far proven doomsayers wrong.
Britain’s May urges EU to break deadlock in Brexit talks
Prime Minister Theresa May urged the European Union on Thursday to break the deadlock and move forward with Brexit talks, asking the bloc’s leaders to respond with “urgency” on easing the fears of their citizens living in Britain. Arriving at a two-day summit in Brussels with other EU leaders, May sought to lower any remaining expectation that she could win a breakthrough in the talks to unravel more than 40 years of union. Instead, she turned the focus to making progress in the coming weeks, particularly on citizens’ rights. Weakened by losing her Conservative Party’s majority in a June election and failing to rally support at an ill-fated party conference, May cannot move on the EU’s insistence on increasing her pay offer for the divorce agreement. She is hamstrung by demands in her own party for her to walk away unless the EU agrees to moving the talks forward to discuss trade, and Germany which does not want to be left with a large bill when Britain leaves the bloc in March 2019.