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US jobless claims rise as country continues to reopen

Virginia and Kentucky see the biggest rise in claims

New claims for unemployment benefits increased by 719,000 in the US last week while remaining around pandemic lows as the vaccine roll-out gains momentum and shops across the country reopen.

This marks an increase of 61,000 in jobless claims for the week ending 27 March, according to the US labour department. The figure comes in below economists’ expectations of 680,000 claims.

A week ago, 658,000 initial claims were registered, the fewest since the beginning of the pandemic.

The figures also demonstrated a narrowing in claims for federal pandemic unemployment assistance of 4,112 in claims to 237,025. This scheme allows gig workers and the self-employed to get assistance.

Among the states that saw the biggest jumps in applications – up by 30,696 and 15,869 claims – were Virginia and Kentucky respectively. Ohio saw the biggest drop.

In early morning trading the S&P 500 is up by 0.66% to 3,999.62 as US stocks held steady following the news.

Joe Biden has been striving to expedite the distribution of vaccines as well as eligibility for people to receive them. This, combined with many states easing lockdown restrictions, has led to an upturn in hiring.

Last week Biden confirmed in his first press conference as president that he had doubled his administration’s vaccination target to 200m during his first 100 days in office. He has also promised that 90% of US adults would be eligible for a jab by 19 April. 

So far, in excess of 150m vaccine doses have been given out in America.

In addition to his $1.9trn stimulus plan, Biden also announced a $2tn infrastructure plan to provide additional support to the economy as it recovers from the effects of the pandemic.

The figures on jobless claims precedes Friday’s nonfram payroll report, which it is anticipated will show that 647,000 jobs have been added to the US economy, along with a fall in unemployment to 6%.

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