US jobless claims rise from three-month low

The number of Americans filing for unemployment benefits rebounded from a three-month low last week, but remained below a level consistent with a tightening labor market.

Initial claims for state unemployment benefits increased 10,000 to a seasonally adjusted 244,000 for the week ended July 22, the Labor Department said on Thursday.

Data for the prior week was revised to show 1,000 more applications received than previously reported.

Economists polled by Reuters had forecast claims rising to 241,000. It was the 125th straight week that claims remained below 300,000, a threshold associated with a robust labor market. That is the longest such stretch since 1970, when the labor market was smaller. The labor market is near full employment, with the jobless rate at 4.4 percent.

Claims have been volatile in recent weeks as automakers shut assembly plants for annual retooling. Some manufacturers like General Motors are extending their summer shutdowns to manage excess inventory from declining sales.

Economists say this could be throwing off the model used by the government to strip out seasonal fluctuations from the data, causing swings in the weekly numbers.

A Labor Department official said there were no special factors influencing the claims data and that no states had been estimated.
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UK unemployment rate at 4-decade low, but pay growth still trails inflation

British workers saw their pay and bonus growth fall further behind inflation in the three months to end-May, data showed on Wednesday, but the jobless rate hit a 42-year low.

The reports will complicate the debate among Bank of England (BoE) officials over the need for higher interest rates.

Sterling bounced against the dollar after official figures showed the unemployment rate in the period between March and May fell to its lowest since 1975 at 4.5 per cent, below the average forecast of 4.6 per cent in a Reuters poll of economists.

But lacklustre wage growth showed the challenge facing Prime Minister Theresa May and her minority government, with growing signs that households are feeling the strain of rising prices since last year's Brexit vote.

The Office for National Statistics said pay including bonuses, adjusted for inflation, fell 0.7 per cent in the three months to May compared with a year earlier — the sharpest drop since mid-2014.

In nominal terms, total earnings rose by an annual 1.8 percent, the weakest increase since the three months to November 2014 and compared with 2.1 per cent in the period to April. This was in line with the Reuters poll consensus.

Inflation hit an almost four-year high of 2.9 per cent in May, official data showed last month, a bigger increase than economists had expected.

After BoE Deputy Governor Ben Broadbent signalled his reluctance to raise interest rates in an interview published on Wednesday, the latest figures broadly confirmed policymakers' existing views of the labour market.
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