Underscored The Labor Market

The Weekly Bottom Line HIGHLIGHTS OF THE WEEK United States The risk of debt restructuring in Greece is mounting, which in turned spurred Standard & Poor's to downgrade the country's credit rating by two notches. Meanwhile, the roller coaster ride of crude oil underscored the volatility in oil markets, prompting U.S. stock markets to mirror these movements. The effects of surging oil prices were evident on March's trade data, and April's retail sales and consumer price data Going forward, should the recent drops in the price of crude oil be sustained, it could provide some relief to consumer spending and the trade balance. Canada Inflation is expected to record another sizeable gain when data are released next Friday. Food and energy have only been mostly ...

(Reuters) - One of the Federal Reserve's most powerful policy makers pushed back against an increasingly hawkish tone from other Fed officials worried about inflation, saying he saw no need for the U.S. central bank to reverse course. William Dudley, president of the New York Federal Reserve Bank, said on Friday the Fed was "still very far away" from achieving its mandate of maximum sustainable employment and price stability, even though the economy is on a firmer footing. His caution contrasted with comments from three other Fed officials on Friday who focused on the risks that the U.S. central bank's policies could fuel inflation. Earlier on Friday, upbeat jobs data underscored how the U.S. labor market was on the mend. But Dudley's comments prompted prices for safe-haven U.S. ...

(Reuters) - Employment likely posted a second straight month of solid gains in March, marking a decisive shift in the labor market that should help to underpin the economic recovery. Nonfarm payrolls rose 190,000 last month, according to a Reuters survey, after increasing 192,000 in February. The anticipated job gains come amid indications the economy suffered a minor setback early in the year as bad weather and rising energy prices dampened activity. "All the evidence is pointing to a strengthening labor market," said Bill Cheney, chief economist at John Hancock Financial Services in Boston. The Labor Department will release the closely watched employment report at 08:30 a.m. on Friday. While the report will indicate sufficient underlying strength in the economy to cushion it against ...

(Reuters) - European leaders agreed on Thursday to increase their financial rescue fund to the full 440 billion euros by June, but avoided discussion of Portugal which is under pressure to seek a bailout following the resignation of its prime minister. Having said for weeks that they would agree a "comprehensive package" to tackle the euro zone debt crisis by the end of March, the leaders ended up delaying a final decision on boosting their safety net until mid-year. That agreement at a two-day summit in Brussels was lauded as an accomplishment by Herman Van Rompuy, the president of the European Council, but worries about Portugal's political crisis overshadowed the meeting. Prime Minister Jose Socrates quit on Wednesday after parliament rejected new austerity measures that he had hoped ...

(Reuters) - New orders for long-lasting manufactured goods fell in February, hinting at some unexpected softness in manufacturing activity and business investment plans. But other data Thursday showed the improvement in the labor market was becoming sustained, with new claims for jobless benefits falling last week and the four-week moving average dropping to it lowest level in more than 2-1/2 years. The Commerce Department said durable goods orders fell 0.9 percent after a 3.6 percent increase in January. Economists polled by Reuters had expected a 1.1 percent increase. Excluding transportation, orders fell 0.6 percent after dropping 3.0 percent in January. "Durables were extremely disappointing ... it is not a very good sign for what is happening in the first quarter," said Rudy Narvas, ...

(Reuters) - Gold erased some of early gains in directionless trade on Friday, under pressure from a drop in ETF holdings to their lowest since late January, a firm U.S. dollar and a lackluster physical market. Premiums for gold bars were steady in Hong Kong and Singapore, with no signs of buying interest from China after the Lunar New Year celebration. Unrest in Egypt could underpin sentiment, but there was hardly any physical buying in Asia related to the deadly turmoil. Egypt's people-power protesters, reeling with disillusion and anger after President Hosni Mubarak dashed hopes he would resign, planned massive new demonstrations on Friday that may test the army's loyalties. "There's not much going on in terms of demand in the physical market. That's why there are some stocks kept ...

(Reuters) - New claims for jobless benefits moved higher last week, but a decline in the four-week average to a nearly 2-1/2-year low suggested the labor market continues to improve. Initial claims for state unemployment benefits increased 18,000 to a seasonally adjusted 409,000, the Labor Department said on Thursday, above economists' expectations for 400,000. The data falls outside the survey period for the government's closely watched employment report for December, which on Friday is expected to show nonfarm payrolls jumped 175,000 after November's surprisingly small 39,000 gain. The spike in claims does little to change perceptions the economy is now on a sustainable growth path, as flagged by sturdy data on consumer spending, trade and manufacturing. Signs that the labor market ...

(Reuters) - Demand for a range of long-lasting U.S. manufactured goods surged in November and consumer spending rose for a fifth straight month, cementing views of a solid economic growth pace in the fourth quarter. The brightening outlook was also bolstered by other reports on Thursday showing an improving labor market and consumer sentiment, though housing continues to struggle. Durable goods orders excluding transportation increased 2.4 percent last month, the largest advance since March, the Commerce Department said. The increase followed a 1.9 percent drop in October and beat economists' expectations for a 1.6 percent rebound. The durable goods orders report should help to allay fears of a marked slowdown in factory activity. "This looks like an economy that is now growing over ...

(Reuters) - U.S. employment barely grew in November and the jobless rate unexpectedly hit a seven-month high, hardening views the Federal Reserve would stick to its $600 billion plan to shore up the anemic recovery. Nonfarm payrolls rose 39,000, with private hiring gaining only 50,000, just a third of what economists had expected, a Labor Department report showed on Friday. The unemployment rate jumped to 9.8 percent from 9.6 percent in October. The weak report was a surprise given the relative strength of some other recent economic signals, including robust retail sales. Economists had expected 140,000 new jobs and a steady unemployment rate. While the data raised a warning flag, many analysts cautioned against reading too much into it. "The report comes as an unwelcome bucket of cold ...