The number of Americans filing new claims for unemployment benefits fell less than expected last week as California continued to process a backlog of applications caused by computer problems.
Initial claims for state unemployment benefits fell 12,000 to a seasonally adjusted 350,000, the Labor Department said on Thursday. Claims for the prior week were revised to show 4,000 more applications filed than previously reported.
Economists polled by Reuters had expected first-time applications to fall to 340,000 last week.
A Labor Department analyst said claims from the backlog in California were still working their way through the system. Technical problems as California converted to a new computer system have distorted the claims data since September, making it difficult to get a clear read of labor market conditions.
A 16-day partial shutdown of the federal government also pushed up claims in recent weeks as furloughed nonfederal workers applied for benefits. Claims filed by federal employees fell 25,939 in the week ended Oct. 12.
The four-week moving average for new claims, considered a better measure of labor market trends, rose 10,750 to 348,250. The number of people still receiving benefits under regular state programs after an initial week of aid fell 8,000 to 2.87 million in the week ended Oct. 12.
The so-called continuing claims data covered the October household survey week from which the unemployment rate is derived. Continuing claims increased between the September and October household surveys, suggesting a rise in the unemployment rate.
But the government shutdown which lasted through the survey period could have affected the gathering of responses and resulted in a smaller sample from which to construct the jobless rate.
Trade deficit widens
The U.S. trade deficit widened slightly in August as exports slipped, suggesting trade will probably not be much of a boost to growth in the third quarter.
The Commerce Department said the trade gap nudged up 0.4 percent to $38.8 billion. July's shortfall on the trade balance was revised to $38.6 billion from the previously reported $39.15 billion.
Economists polled by Reuters had expected the trade deficit to edge up to $39.5 billion in August.
The report was originally scheduled for release on Oct. 8 but was delayed after the federal government was partially shut down because of a fight over the government budget and raising the debt ceiling. The 16-day shutdown ended last Wednesday.
When adjusted for inflation, the trade gap was little changed at 47.3 billion from July. This measure goes into the calculation of gross domestic product.
Trade made no contribution to GDP growth in the second quarter and will likely offer only a modest lift to third-quarter output.
The economy grew at a 2.5 percent annual rate in the April-June quarter, stepping up from the first-quarter's 1.1 percent pace. Third-quarter growth estimates are currently around 2 percent.
The three-month moving average of the trade deficit, which irons out month-to-to month volatility, fell to $37.3 billion in the three months to August from $39.0 billion in the prior period.
Exports of goods and services dipped 0.1 percent to $189.2 billion in August. However, exports of automobiles and parts hit a record high. While imports were flat overall, the amount of goods imported from China was the highest since November 2012.
The weak import growth is consistent with sluggish domestic demand.
--By Reuters