Daily Economic Update: Jobless Claims

Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update highlights jobless claims.

• The good news today from economic reports comes from new jobless claims which continue to fall and are down to 395,000. The four-week average of 405,000, down 3,250 in the week, is at the lowest level since middle of  April. This is a 13,000 decrease from the same time in July. The 400,000 level is generally considered by economists as a point at which the economy is creating more jobs than losing, however it appears that recent slowdown in employment gains is due to a lack of hiring rather than more firings.
• Continuing claims also indicate improvement and fell 60,000 to 3.688 million. Decrease in claims was reported by 44 states, while 9 reported an increase. Assuming that new jobless claims continue to trend down, NAR expects about 1.5 to 2 million net new jobs in the next 12 months.
• Relatively worse news today comes from further worsening of trade deficit for June which increased to $53.1 billion, from $50.8 billion the month before. Increase in deficit was largely driven by falling exports which dropped 2.3 percent, again following 0.5 drop in May. this may be suggesting general slowing of the global economy. Imports also fell but relatively smaller 0.8 percent, following 2.9% increase in May.
• The deficit increase was led by non-oil products. As suggested by lower oil prices, petroleum goods gap narrowed, while services continue to remain in surplus. As for the end use category of goods, decrease in exports was led by drop in industrial supplies, but also capital good excluding autos, and foods, feeds and beverages. Modest gains were seen in consumer goods and automotive. The drop in imports by end use categories was led by fall in industrial supplies, also with modest decrease in capital goods ex autos, autos, and consumer goods.