The number of people claiming unemployment benefits in the U.S. fell for the second time in two weeks.
Economists were surprised last week to witness an unexpected drop in numbers in the amount of people claiming unemployment benefits in the U.S. This week too, the numbers fell further, coming as a pleasant surprise. The data on decline in jobless claims was released Thursday by the Labor Department.
"Fundamentally, we are getting on a little better footing right now," said Omair Sharif, an economist at the Royal Bank of Scotland in Stamford, Conn.
According to the Labor Department report, claims for state jobless aid fell 7,000 last week to a seasonally adjusted 340,000. This week, the numbers fell further and confounded economists' expectations for an increase to 355,000.
Market experts suspect this may come as good news and it could suggest a rise in the number of jobs in the country.
"The sharp deterioration in trade shaves a bit from the outlook for growth in the first quarter," said Diane Swonk, chief economist at Mesirow Financial. "There are signs that domestic demand is firming, which would provide a major offset to weakness abroad."
Earlier last month, despite positive news from the Labor Department's report suggesting job growth acceleration in the end of last year and beginning of this year, unemployment rates in the U.S went up by 7.9 percent.
The fear of recession will slowly subside as the report suggests that 157,000 jobs were added in January with improvement in other economical data as well.
"A solid gain in US employment provides welcome reassurance that the US economy is healthier than the surprise fall in fourth quarter GDP indicated and is not at risk of a renewed recession," said Chris Williamson, chief economist at research firm Markit. "However, policymakers will no doubt remain unimpressed at the pace of the job market recovery, suggesting there is no end in sight for Fed stimulus."
However, this drop in unemployment benefit claims largely reflects an increase in hiring while output continued to expand at a slower pace.
