-Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc.
The number of Americans filling new claims for unemployment benefits rose in the week ended February 28, breaking above 300,000 threshold. Initial jobless claims across the US increased to a seasonally adjusted 320,000 in the measured period, the Department of Labor said, following the last week's figure of 313,000. Meanwhile, continuing claims for the week ending February 14 rose to 2.421 million, compared to last week's upwardly revised reading of 2.404 million. Earlier this week ADP's report revealed that private sector employment increased by 212,000 jobs in February, following an upwardly revised 250,000 increase booked a month earlier. Today's report may show employers added 235,000 workers in February, while the unemployment rate is expected to drop to 5.6%, matching a more than six-year low. Solid job gains are encouraging as strengthening labour market indicate that the Fed may decide to increase interest rates sooner than expected. The US labour market coupled with inflation are key determinants when it comes to the debate about the timing of the monetary policy normalization.
A separate report showed US productivity dropped at a 2.2% annual pace in the December quarter compared with 1.8% rate reported in the preceding month.
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