THE TAKEAWAY:[U.S. Initial Jobless Claims increased to 371,000] > [Battle over debt limit adds concerns of expansion in labor market] > [USDJPY Neutral]
U.S. Applications for unemployment insurance payments rose more than expected in the week ended January 5, which is the fifth increase since September 14. According to a report issued by Labor Department in Washington today, jobless claims jumped by 4,000 to 371,000 unexpectedly. Initial claims from two week ago were revised downwardly to 367,000 from an initially reported 372,000. 48 economists polled by Bloomberg News had forecasted a drop to 365,000. Meanwhile, the continuing claims fell to 3,109,000 from a revised reading of 3,236,000 two weeks ago.
The U.S. job market failed to pick up in early 2013 after an agreement reached by Congress and the fiscal cliff was avoided. Amid fear of debt ceiling which is likely to lead further damage and the delayed budget cuts that threatened the expansion, Americans new hiring remained uneven with slow growth pace. At the same time, the unemployment rate in Europe coming out earlier this month is seen hitting a record high of 11.8 percent, adding signs to struggling of the global labor market.
USD/JPY 1-minute Chart: January 10, 2013
Chart created using Market Scope – Prepared by Renee Mu
The U.S. dollar was mixed in the minute after the Initial Jobless Claims was released. At the time this report was written, the USD/JPY pair traded lower at 87.17 yen.
--- Written by Renee Mu DailyFX Research