US jobless claims were pretty much inline with expectations with 326K claims ending in the week of January 11, only marking a 2K decrease from the previous week, according to the Labor Department. Last week’s 330K jobless claims figure was revised down to 328K. The decline marks the smallest decent in claims since the end of November. The median forecast was 328K claims.
Consumer prices increased with a .3 percent gain in the consumer-price index (CPI), the biggest move since June. However, much of the move was led by energy costs and rents. Nevertheless, it moves the stagnant inflation rate nearer to the two percent Federal Reserve target. The core measure, ex-fuel and food, only nudged .1 percent higher. All CPI figures came inline with expectations.
Maybe a sour note for housing, rental demand is strengthening, probably due to higher home prices.
The pickup in inflation has been slow, and it is still at lower levels. The higher real unemployment rate, that includes part-time work and underemployment as a factor, is worrying with some as the ominous deflation topic began to circle. Michelle Meyer, senior US economist at Bank of American-Merrill Lynch, said a rise in inflation was expected due to its already low levels. “Our forecast is that it’s a very slow-moving process,” said Meyer. In 2013, consumer prices only rose 1.5 percent, the slowest in three years.
The dollar declined on the news and currently down .25 percent.