The number of Americans filing claims for the first time for unemployment benefits hit unexpected figures when it rose last week, although there are other indications that the labor market is recovering lately.
Analysts believe this is likely a factor of snowstorm weather in the south during mid-February although labor market prospects are improving. The market recovery is driven by declining Covid-19 cases and eventually allowing more service businesses to reopen.
A report released by the Department of Labor today showed the total unemployment claims last week recorded a total reading of 745,000 claims. The reading exceeded analysts' expectations at 736,000 and jumped from the previous week's 848,000.
Stormy weather in the South left much of Texas without electricity and water for days. This has forced oil and gas production to close.
On the other hand, consumer spending increased strongly in January as Covid-19 cases and hospital admissions declined sharply. Economists believe the labor market will grow faster with the mass distribution of vaccinations.
The market is now focusing on NFP data which will be released tomorrow.
