WASHINGTON: The number of Americans filing new claims for unemployment benefits fell to a seven-month low last week, but the pace of decline has slowed and further improvement could be limited by a raging COVID-19 pandemic and lack of additional fiscal stimulus.
"There are not enough jobs and not enough inflation out there to assuage the worries of Fed officials trying to go it alone to engineer this economic recovery as Washington elected officials dither over providing additional fiscal stimulus," said Chris Rupkey, chief economist at MUFG in New York. Even without restrictions, many consumers are likely to stay away from places like bars, restaurants and gyms, fearing exposure to the illness. Restaurants and gyms moved outdoors during summer.
But fiscal stimulus has run out, which will make it harder for the economy to generate enough jobs to absorb the millions of unemployed Americans. The number of people receiving benefits after an initial week of aid declined 436,000 to 6.786 million in the week ending Oct. 31, partly reflecting many people exhausting their six months of eligibility.
In another report on Thursday, the Labor Department said its consumer price index was unchanged last month following a 0.2per cent increase in September. A 0.2per cent rebound in food prices was offset by a 0.5per cent drop in the cost of gasoline.