Thursday, May 5, 2011

Jobless Claims in U.S. Unexpectedly Jump Due to Anomalies

WASHINGTON (Reuters) - The number of Americans filing for jobless benefits rose to an eight-month high last week and productivity growth slowed in the first quarter, clouding the outlook for an economy that is struggling to gain speed.
Initial claims for state unemployment benefits rose 43,000 to a seasonally adjusted 474,000, the highest since mid-August, the Labor Department said on Thursday.
Claims were pushed up by factors ranging from spring break layoffs to the introduction of an emergency benefits program.
Economists had expected claims to fall to 410,000.
A second report from the department showed nonfarm productivity increased at a 1.6 percent annual rate, braking from a 2.9 percent pace in the fourth quarter. The growth pace was above economists' expectations for 1 percent.
"I think we're in a situation where the markets and the Fed have been too optimistic," said Bob Andres, chief investment strategist and economist at Merion Wealth Partners in Berwyn, Pennsylvania.
"I don't think we're going to fall off a cliff but the road to real recovery and full unemployment is going to take a long time, and people ought to get back into that mode."
U.S. stock index futures extended losses after the jobless claims data, while government debt prices touched session highs the data. The dollar extended losses against the yen, but rose against the euro.