Do economic conditions suggest that the Fed will step up stimulus even further?
*The Wall Street Journal, by Brian Blackstone, April 2, 2009
“New U.S. claims for state unemployment benefits jumped last week to a 26-year high while total claims soared to a fresh record, highlighting the risk of what could be a nearly historic drop in March payrolls due for release Friday.
Separately, U.S. factory orders rose in February after six consecutive declines, but a sign of future demand tumbled, indicating manufacturing’s troubles aren’t over.
Initial claims for state jobless benefits increased 12,000 to 669,000 in the week ended March 28, the Labor Department said in a weekly report Thursday, the highest level since October 1982.
Wall Street economists in a Dow Jones Newswires survey had expected a smaller rise of 3,000. The prior week’s level was revised up.
The four-week average — which aims to smooth volatility — rose 6,500 to 656,750. That’s also the highest since the 1982 recession.
The U.S. has lost 4.4 million jobs since the recession started in late 2007, including the largest monthly drop in six decades in December, 681,000, followed by declines in excess of 650,000 in both January and February.
Recent jobless claims figures suggest last month’s decline could top December’s, which would push the unemployment rate — already a 25-year high of 8.1% — up closer to 8.5%.”
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