U.S. jobs, inflation data point to sustained economic strength
By Lucia Mutikani
WASHINGTON (Reuters) - The number of Americans filing for unemployment benefits unexpectedly held steady near a 43-year low last week, pointing to further momentum in the labor market after job growth surged in June.
Another report on Thursday showed producer prices recorded their biggest gain in a year in June on rising costs for energy products and services. The signs of sustained strength in the economy, together with a U.S. stock market rally, could allow the Federal Reserve to raise interest rates later this year.
"The days of falling prices are pretty much over and the labor market is strengthening, which raises the question: Is anyone at the Fed paying attention?" said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania.
"Fed members, who fear anything that is not normal and hide from it, may want to peak out from under their rocks."
Initial claims for state unemployment benefits were unchanged at a seasonally adjusted 254,000 for the week ended July 9, the Labor Department said. Claims are near the 43-year low of 248,000 touched in mid-April.
Economists had forecast first-time applications for jobless benefits rising to 265,000 in the latest week. Claims have now been below 300,000, a threshold associated with a healthy labor market, for 71 straight weeks, the longest stretch since 1973.
The four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week volatility, fell 5,750 to 259,000 last week.
The labor market is on a strong footing, with nonfarm payrolls having increased by a robust 287,000 jobs in June, which should underpin economic growth for the rest of the year. Continued...