The number of Americans filing new claims for unemployment benefits fell sharply last week to the lowest level in more than four and a half years, according to government data on Thursday that suggested improvement in the labor market.
The news could help President Barack Obama in his tight race for re-election on November 6 against Republican challenger Mitt Romney, who says Obama has mishandled the economy.
But a second report released on Thursday hinted at weaker U.S. and global demand. The U.S. trade deficit widened in August to $44.2 billion, as U.S. goods exports fell for the fifth consecutive month and imports declined fractionally.
Initial claims for state unemployment benefits fell 30,000 to a seasonally adjusted 339,000, the Labor Department said.
It was the lowest number of new claims since February 2008, about a year before Obama took office in the midst of the global financial crisis.
UPDATE: The Wall Street Journal reports the following:
The Labor Department factors this trend into its seasonally adjusted figures. But last week, a Labor economist said one “large” state didn’t report additional quarterly figures as expected, accounting for a substantial part of the decrease. The official wouldn’t disclose which state, but said it would be released with next week’s report as usual.
In other words, this data is incomplete.
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