BREAKING: U.S. Labour Market Gradually Healing; Inflation Still Benign

WASHINGTON (Reuters) - 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.

The labour market slack is keeping inflation muted, with other data on Thursday showing consumer prices unchanged in October as moderate gains in the cost of food and rents were offset by cheaper gasoline and healthcare. The frail economy is one of the major challenges President-elect Joe Biden faces when he takes over from President Donald Trump in January.

Tepid inflation could allow the Federal Reserve to keep its ultra-easy monetary policy for a long time to aid the recovery from the COVID-19 recession, with the labour market not expected to move back to full employment before 2023.

Initial claims for state unemployment benefits fell 48,000 to a seasonally adjusted 709,000 for the week ended Nov 7. Economists polled by Reuters had forecast 735,000 applications for the latest week.

Despite claims dropping to their lowest since March, they remained above their peak of 665,000 during the 2007-2009 Great Recession. Weak demand, especially in the services sector, is forcing employers to shed workers.

Original article: https://www.reuters.com/articl...