Consumer sentiment dips going into holidays (Reuters)
Reuters - U.S. consumer sentiment slipped in December but was not far from the year's highs, a report said on Friday, suggesting Americans were guardedly optimistic about the economy in the holiday season.
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Jobless claims drop slightly, trade gap surges (AP)
2008.09.11By CHRISTOPHER S. RUGABER, AP Business Writer 13 minutes ago
WASHINGTON - New applications for unemployment benefits fell less than expected last week, the U.S. government said Thursday, as the struggling economy continues to take a toll on workers.
The trade deficit, meanwhile, surged to a 16-month high in July as oil prices hit record levels.
The Labor Department reported that applications for jobless benefits dropped to a seasonally adjusted 445,000, down by 6,000 from the prior week. That is above analysts' expectations of 440,000.
The four-week moving average, which smooths out week-to-week fluctuations, rose slightly to 440,000.
Economists consider jobless claims above 400,000 an indicator of a slowing economy. A year ago, initial claims stood at 322,000.
The Commerce Department said the gap between imports and exports rose 5.7 percent to $62.2 billion, much worse than the $58.8 billion Wall Street economists expected.
Both slices of data helped lift investor unease about the economy, already aggravated by weakness in the financial sector. Wall Street appeared headed for a lower opening.
The number of people continuing to draw jobless benefits also increased, rising 122,000 to 3.53 million, above analysts' expectations and the highest in almost five years. The four-week average rose to 3.43 million.
The economy has been hobbled by the housing and financial crises, which caused U.S. gross domestic product to contract late last year. While growth got a boost this spring from a jump in exports and tax rebate checks from the government, many economists predict the United States could slip into recession later this year.
The figures come after the Labor Department reported last week that the unemployment rate rose to 6.1 percent in August, the highest in five years.
Employers cut payrolls by 84,000, the department said last week, the eighth straight month of job losses. So far, 605,000 jobs have been eliminated this year. Some economists estimate that figure could grow to 1 million by year-end.
While the trade gap was driven by higher oil prices in July, a separate report from the Labor Department Thursday said falling oil prices in August helped bring the price of imported goods down by the steepest amount in almost 20 years.
Import prices fell 3.7 percent in August, the first drop since December, as oil prices dropped 12.8 percent.
That may help reduce inflation and provide some leeway for the Federal Reserve to maintain interest rates at current levels when it meets next week. The Fed has been torn this year between higher prices and a sluggish economy.
Increased unemployment can hinder consumer spending as laid off workers and those who fear for their jobs cut back on their purchases. That can further weaken the economy.
GMAC Financial Services said last week that it will lay off 5,000 workers as part of a plan to scale back its mortgage lending. GMAC is majority owned by private equity firm Cerberus Capital Management LP while General Motors Corp. holds a large stake.
The New York Times Co. and tobacco producer Reynolds American Inc. also announced layoffs earlier this week.
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November housing starts up (Reuters)
Reuters - The pace of U.S. home building rose in November as new home starts climbed 6.7 percent, rebounding from a sharp decline in October while building permits fell 3 percent, a government report showed on Tuesday.
Reuters - The pace of U.S. home building rose in November as new home starts climbed 6.7 percent, rebounding from a sharp decline in October while building permits fell 3 percent, a government report showed on Tuesday.
US GDP revised down to show 2.0 percent growth pace (AFP)
AFP - US economic growth has been a bit more sluggish than earlier estimated in the third quarter, growing at a 2.0 percent annualized pace, according to revised data.
AFP - US economic growth has been a bit more sluggish than earlier estimated in the third quarter, growing at a 2.0 percent annualized pace, according to revised data.
Consumers boost buying during holidays (AP)
AP - Keeping the nation's cash registers ringing, consumers boosted their spending in November by the largest amount in four months, raising hopes shoppers will act more like Santas than Scrooges during the holidays.
AP - Keeping the nation's cash registers ringing, consumers boosted their spending in November by the largest amount in four months, raising hopes shoppers will act more like Santas than Scrooges during the holidays.
Consumer confidence ebbs, boosts rate hopes (Reuters)
Reuters - U.S. consumer confidence ebbed in December, while a key measure of inflation held steady in November for first time in four years, boosting the chances of Federal Reserve interest rate cuts in 2007.
Reuters - U.S. consumer confidence ebbed in December, while a key measure of inflation held steady in November for first time in four years, boosting the chances of Federal Reserve interest rate cuts in 2007.
