US jobless claims rise but stay below 4 lakhs

US jobless claims rise but stay below 4 lakhs

Washington: New US claims for unemployment benefits rose slightly last week but held below 4,00,000 for the third straight week, suggesting the labour market was gaining traction.

Economists polled by Reuters had forecast claims at 3,90,000.

The US economy has gathered steam in the second half of the year, expanding at a 2% annual rate in the third quarter. It could accelerate in the fourth quarter.

That could help the country avoid a recession, which is expected in the euro zone. But economists still see a risk of a US recession next year, especially if lawmakers allow extended unemployment benefits and a payroll tax cut to expire at the end of 2011.

A labour department official described the jobless claims report as straightforward, with no states estimating their level of claims.

Initial claims below the 4,00,000 mark are normally seen as pointing to some healing in the jobs market.

The four-week moving average of claims, considered a better measure of labor market trends, fell 3,250 to 3,94,250, the lowest since April.

The number of people still receiving benefits under regular state programs after an initial week of aid rose 68,000 to 3.69 million in the week that ended 12 November.

Economists had forecast so-called continuing claims falling to 3.605 million from a previously reported 3.608 million.

A total of 6.73 million people claimed unemployment benefits under all programs during the week ending 5 November, down 44,608 from the prior week.