n each Economic Update, the Research staff analyzes recently released economic indicators and addresses what these indicators mean for REALTORS® and their clients. Today's update discusses the latest unemployment insurance claims data.
- The claims in unemployment insurance filed by those starting a period of unemployment continued to normalize with the reopening of the federal government after a two-week shutdown. The seasonally adjusted initial claims for unemployment insurance filed in the week ending October 26 dropped to 340,000 which is 10,000 claims fewer than previous week’s number. In the wake of the shutdown, claims spiked up to 373,000.
- Fewer number of claims filed means workers are keeping their existing jobs. However, job creation still remains lackluster given the slow pace of economic growth with tighter government spending being the drag on growth. Yesterday, the ADP – a payroll company that processes payrolls- reported an increase of only 130,000 payroll jobs.
- In relation to the low job creation, the Federal Operations Market Committee of the Federal Reserve Board released a statement yesterday that the federal funds rate will be kept at 0 to ¼ percent in light of the slow pace of job creation and the absence of inflationary pressure. The Fed statement, however, pointed to a possible tapering before the year end. Mortgage rates are likely to have a hit a monthly low and could steadily rise.