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US jobless claims post first back-to-back increases

[WASHINGTON] Applications for US state unemployment benefits unexpectedly rose for a second straight week in the first back-to-back increases since July.

The data indicate that soaring coronavirus cases and fresh lockdowns are spurring a new wave of layoffs.

Initial jobless claims in regular state programmes increased by 30,000 to 778,000 in the week ended Nov 21, according to Labor Department data Wednesday. Without adjustments for seasonal fluctuations, the figure rose by about 78,000 during the week, which coincides with the reference period for the monthly jobs report.

Continuing claims - the total pool of Americans on ongoing state unemployment benefits - fell by 299,000 to 6.07 million in the week ended Nov 14. But the number of Americans on an extended assistance programme continued to increase, a sign that more people have exhausted regular state benefits.

The main figures compared with economists' projections for 730,000 initial claims and 6 million continuing claims, based on the median estimates in Bloomberg surveys.

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The consecutive increases in claims offer evidence that the coronavirus threatens to stall an economic rebound that was already moderating from a breakneck pace in the third quarter, with some economists predicting a contraction for the first quarter.

The job market faces additional hurdles as states and cities restrict business activity and hospitalisations spike.

"The continued weakness of the labour market is something that is going to drive the whole economy down," Catherine Mann, global chief economist at Citigroup, said on Bloomberg Television.

Continuing claims for Pandemic Unemployment Assistance, which provides benefits to self-employed and gig workers, increased by about 466,000 to 9.15 million. The Pandemic Emergency Unemployment Compensation, which provides payments to the long-term unemployed, was used by 4.51 million Americans. Those two programmes will expire at year-end, leaving many without government aid.

In other economic data released Wednesday: US durable goods orders increased at a faster-than-expected clip in October, supported by demand for computers and metals, underscoring a manufacturing sector that continues to support the economy.


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