Major US retailers on Thursday reported gloomy sales for the critical December shopping season, while a separate report showed new claims for jobless benefits fell unexpectedly in the latest week, somewhat easing concerns of a weakening job market.
Retailers said business was hurt by snowstorms, as well as deep discounts aimed at attracting shoppers. "Sixty-six percent of retailers missed what were for many already lowered expectations, well above the long-term average of 43 percent missing forecast," Ken Perkins, president of Retail Metrics, a research firm, said in a research note.
"Combined November and December holiday sales rose just 1.7 percent, the worst since 2002," he said. Expectations for December retail sales were quite low as consumers cut back on discretionary spending in the face of higher gasoline and food prices, resetting mortgages and general economic uncertainty. The Labour Department reported on Thursday that the number of US workers applying for unemployment aid fell by 15,000 last week.
Initial claims for state unemployment insurance benefits fell to a seasonally adjusted 322,000 in the week ended January 5, from a slightly upwardly revised 337,000 the prior week. The four-week moving average of new claims, which irons out volatility in the weekly figures, fell for the second straight week, to 341,000 from 344,000 the prior week.
A Labour Department analyst said there were no special factors behind the surprise decrease and noted that this time of year can be difficult to account for seasonal adjustments. "This is a real tough time of the year for us," he said.
Traditionally, there is a good bit of volatility during the period between Thanksgiving and the observance of civil rights leader Martin Luther King's birthday in mid-January.
The US jobless rate rose to 5 percent last month from 4.7 percent in November, a government report showed on Friday, the largest monthly rise since October 2001, shortly after the September 11 attacks.
US government debt prices dipped and stocks were slightly lower after the data as dealers were reluctant to make major bets ahead of Federal Reserve Chairman Ben Bernanke's afternoon speech.
Last Friday's December jobs report stirred fears the US economy might be falling into a recession, if not already in one, and led financial markets to raise bets that the Federal Reserve would cut interest rates by a hefty half-percentage point at a meeting on January 29-30.
Bernanke could offer more insight into the likely direction of US interest-rate policy in a speech at 1 pm (1800 GMT). The number of people who remain on the benefit rolls after drawing an initial week of aid dropped by 52,000 to 2.70 million in the week ended December 29, the latest period these figures were available.
But that number still remained close to levels reached during 2005 in the aftermath of Hurricane Katrina. A separate report showed a 2.2 percent rise in wholesale sales during November, the biggest monthly gain since September 2005, while inventories rose 0.6 percent.
Comments
Comments are closed.