JUNE 1, 2021 – UNEMPLOYMENT CLAIMS FALL AS JOB PICTURE IMPROVES
Initial unemployment claims kept falling last week. New filings came in at 406,000, below analysts’ expectations for 425,000, and down almost 9 percent from the week before. Even though this is an improvement, it is still well above the pre-pandemic average of 225,000 per week. Continuing claims fell by 4 percent, to 3.6 million, and the people receiving payments fell by 175,000 to 15.8 million.
In another report, the Commerce Department confirmed their initial estimate of Q1 2021 GDP growth remains at 6.4 percent. Economists had been expecting a revision up to 6.6 percent growth. Revised numbers for improvements in consumer spending and nonresidential fixed investment were offset by reductions in exports and private inventory investment. The core personal consumption expenditures price index is 2.5 percent up from an initial estimate of 2.3 percent. The Federal Reserve is tracking the PCE as inflation pressures build.
The Fed is reticent to raise rates until inflation remains consistently above the 2 percent target, and full employment is reached.