MW: Jobless claims drop 15,000 as CPI growth slows
By Ruth Mantell, MarketWatch
WASHINGTON (MarketWatch) — A flurry of government data released Thursday morning showed that consumer prices rose at a slower rate in July, and the pace of layoffs likely slowed down in recent weeks.
The Labor Department reported that the number of people who applied for new regular state unemployment-insurance benefits fell 15,000 to 320,000 in the week that ended Aug. 10, hitting the lowest level of initial claims since October 2007, two months before the Great Recession started.
Also, U.S. consumer prices rose a seasonally adjusted 0.2% on gains for gasoline, housing, clothing and food, among other goods. Excluding energy and food, the core consumer-price index also rose 0.2%.
The latest inflation readings matched forecasts from economists polled by MarketWatch, while the claims data was slightly better than analysts’ expectations.
U.S. stock futures SPU3 -0.76% were still deeply negative after the data was released.See Indications.
Observers are paying particularly close attention to data reports as they look for clues that could inform the Federal Reserve’s decision on the timing to taper its massive bond-buying program.
Avery Shenfeld of CIBC World Markets says the claims data suggests a “solid” August payrolls — adding weight to talk of a tapering in September.
Some analysts expect that a tapering announcement could come as early as next month, though there’s been concern about inflation running too low.
Thursday’s report indicated that inflation somewhat moderated in July. In June, the overall CPI rose 0.5%, while the core CPI rose 0.2%.
In July prices for gasoline rose 1%, down from June’s gain of 6.3%. Food prices in July rose 0.1%, compared with a gain of 0.2% in June. Meanwhile, apparel prices rose 0.6% in July, down from June’s gain of 0.9%. Shelter prices in July increased 0.2%, the same as June.
Consumer prices have increased 2% over the past 12 months, and the core has increased 1.7%.
Ruth Mantell is a MarketWatch reporter based in Washington. Follow her on Twitter @RuthMantell.
