Jobless Claims Rise, Consumers Fall Behind

123jump.com Staff
03 Apr, 2008
New York City

For months economists and Fed regulators have denied that the U.S. economy is in recession, but evidence is mounting that weakness in housing market and in financial services is spreading into the broader economy. Jobless claims at the end of the last week rose by 38,000 and now nearly 3 million people are receiving weekly unemployment benefits according to the Labor Department. Separately ABA quarterly report showed more consumers are falling behind on their loans.

[R]10:15 AM New York – Jobless claims rise at the end of last week and more consumers struggle to pay loans on time.[/R]

Jobless claims rise

Job markets remained weak and the latest data confirmed further weakness in the labor market. Initial claims of unemployment benefits rose at the end of the last week by 38,000 according to the Labor Department. The four week average of the claims reached 374,500 at the end of the week.

Construction and housing markets, financial services and manufacturing sectors were the key contributors of the weakness.

The Labor Department report further added that number of people receiving weekly benefits increased by 97,000 to 2.94 million, nearly 4-year high.

The weakness in the labor market was widespread as twenty two states reported a rise in claims and thirty one states reported a decline in claims.

Consumers fall behind in loan payments

More consumers fell behind on their loan payments in the fourth quarters according to the latest survey from American Bankers Association.

The composite ratio, which tracks eight categories of short term loans, rose 0.21% to 2.65% in the fourth quarter, highest level since 1992. Auto loans delinquencies were the key contributors to the weakness in the performance.

According to the report, home equity loan delinquencies rose to 2.4% from 2.28% and indirect auto loans rose to 3.13% from 2.86%.

International markets

In Tokyo Nikkei 225 Index closed higher 200.54 or 1.52% to 13,.389.90, in Hong Kong Hang Seng index increased 392.20 or 1.64% closed to 24,264.63. In Australia ASX 200 index higher 106.00 or 1.93% to close 5,608.90. In Malaysia KL Composite index decreased 14.07 or 1.14% closed to 1,225.58.

In South Korea Kospi Index increased 21.44 or 1.23% to close at 1,763.63, in Thailand SET index closed higher 0.97 or 0.12% to 826.68 and Indonesia JSE Index edged decreased 104.22 or 4.45% to 2,237.97. Sensex index in India increased 82.15 or 0.52% to 15,832.55.