US weekly initial jobless claims hit three-month peak; existing home sales drop

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On Thursday, 20th January 2022, US Labor Department data had unveiled that the number of Americans filing for first-time state unemployment benefits had spiked surprisingly to a three-month peak last week, most likely driven by a winter wave of Omicron surge which health experts had often claimed to have a lower hospitalization rate alongside mild or asymptomatic patients in most cases.

Nonetheless, despite growing evidence on the bright side of a worldwide Omicron wave with S. African cases declining sharply since December, US business activity seemed to have been disrupted by a significant scale which would likely weigh in on January job growth.

Apart from a third straight week of increase in US initial jobless claims, other economic data released earlier in the day had unveiled that US existing home sales had plunged 4.6 per cent last month, largely catalysed by a growing bet on an earlier-than-anticipated rate-hike from US Fed which already begins to spur up average long-term mortgage rates with 30-year fixed home loans jumping by 0.22 percentage points 3.45 per cent over the week that ended on January 13.

Aside from that, a lingering supply chain constraint with a steep lag in softwood import from Canada appears to be stepping up prices, swaying first-time buyers away.

US weekly initial jobless claims rise to three-month peak

According to US Labor Department data, US initial jobless claims rose 55,000 to a seasonally adjusted 286,000 filings over the week that ended on January 15, while continuing claims increased 84,000 to 1.635 million during the week that ended on January 8.

Nonetheless, adding a shimmering silver lining in a day crammed with a cascade of dismal data, the Philadelphia Fed said on Thursday that its index for business activities jumped to a reading of 23.2 in January compared to a 15.4 logged a month earlier.