The number of Americans submitting new claims for unemployment benefits unexpectedly rose last week even as the labor market recorded a recovery driven by brisk economic activity and increased vaccinations.
Initial claims for unemployment benefits were 412,000 for the week ended June 12 based on a report released by the Department of Labor on Thursday.
This reading is up from the previous week which recorded a total claims of only 375,000 and last week’s reading also strayed from the survey of investors who targeted a total of claims of only 360,000.
This increase in unemployment claims is a surprise as past data shows there has been a significant increase in employment. A year ago, the country recorded nearly 1.5 million new claims a week following the closure of economic sectors.
However, with the increase in more widespread vaccinations and the sharp decline in cases of Covid-19 infection has led to an increase in employment. Nevertheless, the recent emergence of new variants of Covid-19 has affected a handful of employment sectors.
Federal Reserve Chairman Jerome Powell stressed that the U.S. economy is facing difficulties in recovering the 9.3 million jobs affected lost as a result of Covid-19.
The US dollar continued to climb higher after being driven by the latest projections from the Federal Reserve (Fed) which showed the possibility of interest rates faster than expected.
At the time of writing, the dollar index that measures the strength of the greenback dollar against six other major currencies traded higher at 91.763.
