After a surge in the previous week’s data, the number of U.S. first-Time claims fell slightly last week, but remained high overall.
Data from the U.S. Department of Labor showed that 900,000 Americans filed for unemployment benefits for the first time in the week ended Jan. 16, which was better than the market’s expectation of 925,000 and down from the previous week, but still at a 4-month high.
The number of people renewing their unemployment claims is also decreasing, with the number of people renewing their claims falling by 127,000 last week to 5.05 million, better than the market’s expectation of 5.3 million.
On the regional front, this week’s decline was primarily driven by improved data from California.
Despite the decline, the current level of unemployment claims is still well above the pre-Epidemic level. The U.S. is now taking stricter business restrictions in many areas due to the spread of the secondary outbreak. Although vaccines have begun to be distributed across the U.S., the current distribution of the new crown vaccine is much slower than expected, limiting the speed of recovery in the job market.
Market analysis suggests that the data may suggest that the U.S. January nonfarm payrolls data, to be released on February 5, may be quite weak.
After the release of the data, the market reaction was quiet, and U.S. stock index futures rose slightly. Investors expect the Biden administration to soon launch a new epidemic stimulus to help ordinary Americans weather the storm.
Biden unveiled a $1.9 trillion economic bailout plan last week. If approved by Congress, the plan would provide $400 a week in supplemental unemployment benefits to state and local governments through September and $1,400 in direct payments to individuals, on top of the $600 approved last December, which would help some Americans weather the storm.
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