Jobless Claims Remain Stubbornly High

The expected fall in Initial Jobless Claims didn’t happen for the week ending September 5th according to the BLS. The just-released total of 884k was slightly higher than the 850k that was expected and was unchanged from the prior week’s slightly revised tally. The cumulative total for Initial Claims filed since the pandemic-induced lockdown now total over 60M. Continuing Claims for the week ending August 29th also disappointed analysts looking for a decline to 12.9M from 13.3M. Instead, the week’s total climbed slightly to 13.39M.

An inflation report on wholesale prices was also released this morning telling us that the headline Producer Price Index rose by 0.3% in August against an estimate of 0.2%. Year-over-year, the deflation rate became slightly less deflationary with a move to minus 0.2% from minus 0.4%. Without food and energy, core PPI rose by a greater-than-expected 0.4% taking the year-over-year pace to 0.6% from 0.3%. Forecasters expected the twelve-month rate to remain unchanged at 0.3%.

The Treasury market has reacted with slight selling pressure that has pushed up the Ten-Year’s yield to almost 72 basis points. The Long Bond sits just below 1.50% and the Two-Year is unchanged at 14 basis points. Equity futures are bouncing around a bit, but look to open in the green. Overnight, the ECB left their negative 0.5% policy rate unchanged as well as their bond-buying program while concerns mount over the strengthening Euro. Crude oil has slipped about a half-dollar to $37.50 while gold is up about $8 to $1,955.