US New Jobless Claims Jump to 500,000

The number of people seeking unemployment benefits jumped by 12,000 last week to 500,000 matching levels not seen since last November. This latest result adds further evidence pointing to a weakening of the recovery, suggesting that companies are slowing the rate of hiring. This meshes with statements from the Federal Reserve last week that the US recovery will be “more modest” than originally predicted.

“We’re seeing a renewed pickup in layoffs,” said Stephen Stanley, chief economist at Pierpont Securities LLC in Stamford, Connecticut. “If firms aren’t hiring it’s probably because they’re not producing. Demand will slow in the third quarter.”

Source: Bloomberg

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