US ECONOMY
WASHINGTON - WORSE-than-expected news on US unemployment and home sales on Thursday dampened optimism that a broad economic recovery might be near.
The Labour Department said initial claims for unemployment compensation rose to a seasonally adjusted 640,000, up from a revised 613,000 the previous week.
New claims for US jobless benefits rose in the past week to 640,000, reversing course after a surprise decline a week earlier. -- PHOTO: AFPIn another sign of labour market weakness, the number of people continuing to claim benefits rose to 6.13 million, setting a record for the 12th straight week.
Meanwhile, the National Association of Realtors said home sales fell 3 per cent to an annual rate of 4.57 million last month, from a downwardly revised pace of 4.71 million units in February.
Sales had been expected to fall to an annual pace of 4.7 million units, according to Thomson Reuters.
A top banking regulator tried to ease some concerns, saying banks and the housing sector had passed the worst part of their downturns.
'I think we're past the crisis stage. We're in the clean up stage now,' Sheila Bair, chairman of the Federal Deposit Insurance Corp, said at a financial reform conference.
But on Wall Street, stocks turned lower after the disappointing housing figures were released. The Dow Jones industrial average lost about 60 points in midday trading, and broader indices also fell.
The jobless rate in the US is expected to average 8.9 per cent this year and climb to 10.1 per cent next year, the IMF said. -- AP
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