US jobless claims in early June rise to 222,000 and exceed expectationss
US unemployment claims unexpectedly increased in early June.
Weekly jobless claims in the US rose to 220,000 in the week ending June 8, according to the US Department of Labour. That figure was higher than economists’ predictions of 216,000 unemployment claims in early June.
Early June US jobless claims part of disappointing economic news
The increase in US jobless claims suggests a slowdown in the robust US economy. The growth in unemployment claims coincides with other potentially worrying economic data like a worse-than-expected non-farm payrolls report.
What are economists saying about early June US jobless claims?
Jake McRobie, US economist with Oxford Economics, said that the lackluster economic statistics could convince the US Federal Reserve to lower interest rates.
‘Combined with increased business uncertainty from rising trade tensions and slowing domestic growth, softer inflation should prompt the Fed to ease policy by year end,’ said McRobie.
Eliza Winger, Bloomberg economic analyst, believes that the US economy is still strong despite the surge in unemployment claims.
‘Jobless claims tend to be volatile, and while the latest jump could be a signal of deteriorating labour market conditions, it is too early to draw that conclusion. The economy is slowing, but it is still growing above potential and expected to generate enough jobs to tighten the labour market further,’ said Winger.
Maria Cosma, economist at Moody’s Analytics, also contends that the latest jobless claims statistics aren't a distressing sign for the economy yet.
‘Claims have been roughly flat over the past couple of months, a potential sign that job growth is slowing. Nevertheless, jobless claims aren’t sending any warning signals just yet,’ said Cosma.
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