The first reading on employment in the new year isn't life changing, but continues to tell a story of "steady as she goes." The Labor Department reports that new claims for unemployment benefits fell by 2,000 last week to 339,000, a bit better than expected. "Good for jobs, good for the economy," says John Silvia, chief economist for Wells Fargo.
The monthly report on unemployment comes out Jan. 10, and will cover what was happening in December. Economists are looking for it to show another month of steady jobs creation after the unemployment rate dipped to 7 percent for November.
Also in the news today, the Institute for Supply Management, or ISM, says manufacturing activity expanded in December for a seventh straight month. The group's closely watched manufacturing index slipped slightly to 57, still making for the second highest reading of 2013. Any number above 50 indicates growth in the ISM index. "American factories appear to be humming," says Ken Mayland, chief economist for ClearView Economics. If this level of manufacturing activity were to continue, he says, it would be in keeping with a 4.6 percent pace of gross domestic product.
The ISM's separate employment index expanded slightly, boding well for next week's jobs report.
The Federal Reserve has said that it wants to continue seeing steady gains in the job market to continue its pull back on monthly asset purchases. January brings the first month of scaling down from the previous monthly level of $85 billion in bond purchases. If that program aimed at boosting the economy is ended -- as expected -- the Fed can think about lifting short-term interest rates up from record low levels. But that isn't expected until 2015.
What are your hopes for the economy this year? Are you feeling a bit more optimistic?
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