More Americans filed initial claims for state unemployment benefit for the week ending July 17. The amount of first-time jobless claims rose by 37,000, to a seasonally adjusted 464,000. This is the largest increase in initial jobless claims since early this year in February. 
The jump in jobless claims is greater then the amount projected by economists who thought that claims would rise to 445,000. The increase in claims wipes out last weeks decline in claims for state unemployment benefits, which was partly attributed to companies like General Motors reporting less temporary layoffs than they normally would during this time of year.
Most analysts agree that the 4-week moving average is a better indicator of initial jobless claims. The average increased by 1,250 to 456,000. The number of people still receiving jobless benefits fell by 223,000 in the week ending July 10th, moving that figure to 4.49 million Americans. This does not include those who receive extended benefits as part of a federal program.
Chairman of the Federal Reserve, Ben Bernanke, spoke yesterday saying that it will take a “significant amount of time” to recover the amount of jobs lost between 2008 and 2009.
The report on jobless claims is just one of many indicators that have been released recently that indicate that economic recovery is beginning to slow down. So long as unemployment remains down consumer spending will be limited. It will be interesting to watch what affect this economic news has on mortgage rates and the housing industry as a whole.
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