Initial Jobless Claims totaled 521k, 19k less than expected, well down from 554k last week which was revised up by 3k. It’s the lowest figure since January. Continuing Claims fell by 72k and were 65k below forecasts. BUT, those receiving Emergency Unemployment Compensation rose by almost 100k to a new record high and those getting Extended Benefits past that rose by almost 5k. The data is clear evidence again that companies continue to reduce the level of firings but still remain extremely reluctant to hire new workers and its why Congress is already discussing a further extension of unemployment insurance. The insured unemployment rate remained unchanged at 4.6%.
ECB President Trichet in his post rate announcement press conference is not saying anything new or market moving and gives no hint whatsoever that they are any closer to raising interest rates. He said rates at 1% “remain appropriate.” He sees “low inflationary pressure over the medium term, as money and credit expansion continues to moderate.” “The current negative inflation rates are in line with previous expectations and largely reflect movements in global commodity prices. Inflation rates are expected to return positive again in coming months.” He does though believe “inflation expectations” are “firmly anchored.” In terms of the recovery, he said uncertainty remains high and it will be uneven. When the economy improves though, he said policy measures will be unwound. He’s stating the obvious with WHEN being the only question.
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