In the week ended May 9, initial claims rose by 32 000 from an upwardly revised 605 000 to 637 000, while the consensus was looking for an outcome of 610 000. The unexpected rise was at least partially due to the massive automotive shutdowns. Also continuing claims surprised on the upside of expectations, rising by 202 000 to a new cyclical high of 6 560 000. In the coming months, the automotive shutdowns are forecasted to keep the claims under upward pressure.
In April, producer prices rose by 0.3% M/M, while the consensus was looking for an increase by 0.2% M/M. Also core PPI, excluding food and energy, came out higher that expected. On a monthly basis, core PPI rose by 0.1% M/M, while the yearly figure came out at 3.4% Y/Y. A 1.5% M/M jump in food and gasoline prices kept the headline index higher, while rises in prices of pharmaceuticals and light trucks offset the drop in tobacco prices in the core reading.
