NEW YORK (CNNfn) - The number of new jobless claims in the United States rose last week but stayed below 400,000 for the third straight week, suggesting that the worst might be over for the U.S. job market.|
New claims for state unemployment benefits rose to 385,000 in the week ended Aug. 4 from a revised 352,000 the prior week, the Labor Department reported. Analysts surveyed by Briefing.com had forecast new claims of† 380,000.
The four-week moving average of new claims, considered a better gauge of jobless trends, fell to 380,000 from the previous period's revised 396,000. Economists watch the four-week moving average more closely since it smoothes fluctuations in the weekly data.
Continued claims -- those by workers who already have claimed at least a week of benefits -- rose to 3.09 million in the week ended July 28, the latest available, after a revised reading of 2.99 million the prior week.
Unemployment has been a particularly sensitive issue in the year-long slowdown in the U.S. economy, as consumer spending makes up two-thirds of all economic activity and has been mainly responsible for keeping the country out of a recession.
In order to keep consumers spending despite hundreds of thousands of job cuts, the Federal Reserve has aggressively cut its target for short-term interest rates six times this year. Many economists think the Fed will cut rates again when it meets Aug. 21 to discuss policy and hope that action will be enough to carry consumers through the worst of the job cuts.
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"As the newspapers remind us every day, job layoffs are still high, but the point is that they now appear to be slowing," said Ian Shepherdson, chief U.S. economist with High Frequency Economics Ltd. "The worst is over, and the decline in output and employment will soon slow."
Separately, the Labor Department also said prices of U.S. imports fell 1.6 percent in July after falling 0.4 percent in June. Leading the decline was a 6.1-percent drop in petroleum import prices, while non-petroleum import prices fell 1.0 percent. Export prices fell 0.4 percent.
The decline in non-petroleum import prices was the sixth straight monthly drop, the longest stretch of declines since September 1998. The price data indicate inflation from overseas is not infecting the U.S. economy, good news for the inflation-wary Fed.