The number of applications for unemployment benefits hovered last week near the highest level of the year, showing little improvement in the U.S. labor market.
Jobless claims decreased by 6,000 to 386,000 in the week ended June 23, in line with the median forecast of economists surveyed by Bloomberg News, Labor Department figures showed today in Washington. The prior week’s reading was revised up to 392,000 from 387,000, matching an April figure as the steepest of 2012.
Concern about the fallout from the European debt crisis and the so-called fiscal cliff that will face the U.S. at the end of this year may prompt employers to keep payrolls lean. Federal Reserve policy makers last week expanded a program to replace short-term bonds with longer-term debt in a bid to spur growth and trim a jobless rate that’s exceeded 8 percent for 40 consecutive months.
“There is no progress,” said Jeremy Lawson, a senior U.S. economist at BNP Paribas in New York. “There is clearly an underlying weakness that is troubling. The labor market is sputtering along, struggling to create jobs. The pace of consumer spending will slow in the second quarter.”
The world’s largest economy expanded 1.9 percent in the first quarter, the same as previously estimated, data from the Commerce Department also showed today.
By Michelle Jamrisko and Shobhana Chandra
Read More: Bloomberg
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Thursday, 28 June 2012
Saturday, 23 June 2012
Euro's big four agree growth boost, split on bonds
(Reuters) - German Chancellor Angela Merkel resisted pressure on Friday for common euro zone bonds or a more flexible use of Europe's rescue funds but agreed with leaders of France, Italy and Spain on a 130 billion euros ($156 billion) package to revive growth.
After four-way talks in Rome's Renaissance Villa Madama, Italian Prime Minister Mario Monti said the European Union should adopt pro-growth measures worth about 1 percent of the region's gross domestic product at a crucial summit next week.
But the three others made no perceptible progress in pushing Merkel, who leads Europe's most powerful economy and the main contributor to its rescue funds, towards mutualising Europe's debts or using existing bailout resources more flexibly.
"Growth can only have solid roots if there is fiscal discipline, but fiscal discipline can be maintained only if there is growth and job creation," Monti told a joint news conference after talks that lasted just an hour and 40 minutes.
The measures, already in the works in Brussels, include increasing the European Investment Bank's capital, redirecting unspent EU regional aid funds and launching project bonds to co-finance major public investment programs. No new steps were announced on Friday.
By Giuseppe Fonte and Gavin Jones
Read More: Reuters
After four-way talks in Rome's Renaissance Villa Madama, Italian Prime Minister Mario Monti said the European Union should adopt pro-growth measures worth about 1 percent of the region's gross domestic product at a crucial summit next week.
But the three others made no perceptible progress in pushing Merkel, who leads Europe's most powerful economy and the main contributor to its rescue funds, towards mutualising Europe's debts or using existing bailout resources more flexibly.
"Growth can only have solid roots if there is fiscal discipline, but fiscal discipline can be maintained only if there is growth and job creation," Monti told a joint news conference after talks that lasted just an hour and 40 minutes.
The measures, already in the works in Brussels, include increasing the European Investment Bank's capital, redirecting unspent EU regional aid funds and launching project bonds to co-finance major public investment programs. No new steps were announced on Friday.
By Giuseppe Fonte and Gavin Jones
Read More: Reuters
Wednesday, 20 June 2012
Fed Expands Operation Twist by $267 Billion Through 2012
The Federal Reserve will expand its Operation Twist program to extend the maturities of assets on its balance sheet and said it stands ready to take further action to put unemployed Americans back to work.
The central bank will prolong the program through the end of the year, selling $267 billion of shorter-term securities and buying the same amount of longer-term debt in a bid to reduce borrowing costs and spur the economy.
“If we don’t see continued improvement in the labor market, we’ll be prepared to take additional steps if appropriate,” Fed Chairman Ben S. Bernanke said at a news conference in Washington following a two-day meeting of the Federal Open Market Committee. “Additional asset purchases would be among the things that we would certainly consider.”
Policy makers moved to shore up the world’s largest economy as faltering growth leaves it vulnerable to fallout from the European debt crisis and looming fiscal tightening in the U.S. Fed officials today lowered their outlook for growth and employment, foreseeing a jobless rate of at least 7.5 percent at the end of 2013.
The yield on the 10-year Treasury note rose to 1.65 percent at 4:35 p.m. in New York from 1.62 percent late yesterday. The Standard & Poor’s 500 Index fell 0.2 percent to 1,355.69 after declining as much as 0.9 percent.
By Jeff Kearns and Joshua Zumbrun
Read more: Bloomberg
The central bank will prolong the program through the end of the year, selling $267 billion of shorter-term securities and buying the same amount of longer-term debt in a bid to reduce borrowing costs and spur the economy.
“If we don’t see continued improvement in the labor market, we’ll be prepared to take additional steps if appropriate,” Fed Chairman Ben S. Bernanke said at a news conference in Washington following a two-day meeting of the Federal Open Market Committee. “Additional asset purchases would be among the things that we would certainly consider.”
Policy makers moved to shore up the world’s largest economy as faltering growth leaves it vulnerable to fallout from the European debt crisis and looming fiscal tightening in the U.S. Fed officials today lowered their outlook for growth and employment, foreseeing a jobless rate of at least 7.5 percent at the end of 2013.
The yield on the 10-year Treasury note rose to 1.65 percent at 4:35 p.m. in New York from 1.62 percent late yesterday. The Standard & Poor’s 500 Index fell 0.2 percent to 1,355.69 after declining as much as 0.9 percent.
By Jeff Kearns and Joshua Zumbrun
Read more: Bloomberg
Debt crisis: Spain and Italy to be bailed out in £600bn deal
European leaders are poised to announce a £600 billion deal to bail out Spain and Italy, it emerged at the G20 summit on Tuesday night.
Two rescue funds are to be used to buy the debts of the troubled economies, the cost of which have reached record highs in recent weeks.
It is hoped that the move, which represents a substantial shift in policy for Germany’s chancellor, Angela Merkel, will send a strong signal to financial markets that Europe’s biggest economy is finally prepared to back its weaker neighbours.
Mrs Merkel and other European leaders have come under intense pressure at this week’s G20 summit to take radical action to stem the growing euro crisis which has pushed up the cost of Spanish bonds to unsustainable levels.
The communiqué issued at the end of the G20 summit, which finished in Mexico last night, said that European leaders had agreed to take action to bring down borrowing rates.
Under the proposed deal, two European rescue funds – the £400 billion (€500 billion) European Stability Mechanism (ESM) and the £200 billion (€250 billion) European Financial Stability Facility (EFSF) – will buy bonds issued by European countries.
By Robert Winnett
Read more: Telegraph
Two rescue funds are to be used to buy the debts of the troubled economies, the cost of which have reached record highs in recent weeks.
It is hoped that the move, which represents a substantial shift in policy for Germany’s chancellor, Angela Merkel, will send a strong signal to financial markets that Europe’s biggest economy is finally prepared to back its weaker neighbours.
Mrs Merkel and other European leaders have come under intense pressure at this week’s G20 summit to take radical action to stem the growing euro crisis which has pushed up the cost of Spanish bonds to unsustainable levels.
The communiqué issued at the end of the G20 summit, which finished in Mexico last night, said that European leaders had agreed to take action to bring down borrowing rates.
Under the proposed deal, two European rescue funds – the £400 billion (€500 billion) European Stability Mechanism (ESM) and the £200 billion (€250 billion) European Financial Stability Facility (EFSF) – will buy bonds issued by European countries.
By Robert Winnett
Read more: Telegraph
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