Mecklai Graph: Soaring unemployment claims

Mecklai graph of the day - Soaring unemployment claims

The number of Americans filing unemployment claims last week rose to 386,000 compared to its previous reading of380, 000. Consistent deterioration has been seen in the US job sector, which is a worrying factor for Fed officials. This disappointing data suggests the job market remains sluggish and companies hired fewer workers than forecast, casting doubt on the vigor of the labor market.

The number of people applying for employment claims has been increasing for the past 6 weeks, with an exception to the previous week, which implies that we can expect the following months ADP and Non farm payrolls to be disappointing. With such a grim backdrop on the employment front Fed is expected to introduce stimulus measures in order to revive the growth in US job markets and hence expectation of QE3 will further build up.

The below graph shows the unemployment claims of US for the past 4 months

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