Just as economic analysts were congratulating themselves on a string of falling jobless claims, they got gobbsmacked by reality this morning.
The claims were expected to be at 355,000; instead they got 380,000. Keep in mind that last week’s was 357,000 and then revised (when you weren’t paying attention) to 367,000. This means that the 380K could actually be 390 or 400K. Doesn’t look too good for the jobs recovery.
In addition, core inflation (core PPI) was flat, only if you strip out food and energy. Put those two little old necessities in and it was at .3% from February’s .2%.
Zerohedge adds this:
Following today’s disappointing jobs data, we thought it useful to reflect on the sad reality that is occurring under the eyes of AAPL Mr. Market. As BofAML notes this morning, their Economic Data Diffusion index (which tracks macro data surprises) has been trending lower for over a month (indicating a trend of data missing expectations to the downside) and, more importantly has turned absolutely negative (indicating a marginally negative bias to the overall economic data expectations). Following our lead, they note the weather’s impact and that this is likely to be the third time in this recovery that the markets and economic consensus has over-reacted to positive news and become too optimistic about growth. Looking ahead, we expect this data downshift to continue. In the near term, both higher gasoline prices and the fading weather effect will likely weigh on growth and, over the course of the second half, we expect the looming fiscal cliff to undercut confidence and growth. Party’s ending, a tough economic reality is looming and the punchbowl remains out of sight for now.