(Reuters) - U.S. jobless claims jumped to their highest level since October while food and energy costs boosted prices, pointing to lingering headwinds for an economic recovery that had been showing renewed vigor.
A surge in exports to their highest level in two years helped narrow the trade deficit, however, an encouraging sign.
Despite the more positive outlook for growth in recent weeks, the job market still appeared to be struggling.
The number of Americans filing for first-time unemployment benefits rose unexpectedly to 445,000 from 410,000 in the prior week, the Labor Department said on Thursday. It was the biggest one-week jump in about six months, confounding analyst forecasts for a small drop to 405,000.
U.S. stock index futures added to losses after the jobless claims data, while government debt prices rose.
"The jobless number highlights the patchy recovery we've seen in the job market and reinforces that it will be a slow process bringing down the jobless rate," said Omer Esiner, market analyst at Commonwealth Foreign Exchange in Washington. "The one bright spot was a further decline in the trade deficit, which should contribute positively to fourth-quarter" growth.
A Labor Department official did note the rebound in benefit claims occurred following the holidays, which may have hindered new applications and created a backlog. Without the seasonal adjustment, claims were up by nearly 200,000 to 770,413.
As last year drew to a close, food and energy costs were rising relentlessly at the wholesale level despite a tame underlying inflation trend, complicating the outlook for monetary policy.
U.S. producer prices climbed 1.1 percent in December after a 0.8 percent rise in November, according to another Labor Department report. Economists had been looking for a repeat of that 0.8 percent advance in December.
Inflation excluding food and energy, however, rose just 0.2 percent, in line with forecasts. That left the year-on-year gain in core producer prices at 1.3 percent, just below analyst estimates.
Among the biggest gainers were home heating oil, which jumped 12.3 percent, and fresh and dry vegetables, which surged 22.8 percent. Fresh fruits and melons rose sharply for a second straight month, posting a 15.4 percent gain.Answer Question
Answer by cbk_mom3 at 11:59 AM on Jan. 13, 2011
Answer by jewjewbee at 12:00 PM on Jan. 13, 2011
Answer by NotPanicking at 12:03 PM on Jan. 13, 2011
damn I thought Recovery Summer was just a little behind schedule. Sucks when your facts get all blown to hell within a few short weeks.
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