Financial markets digested mixed U.S. economic news on Thursday, with signs of continued weakness in the retail sector and an unexpected drop in jobless claims.
A broad range of American retailers reported sales declines in June, from well-known apparel stores like Abercrombie and Fitch to bulk-item seller Costco.
Analysts say rainy weather across large sections of the United States further-dampened consumer enthusiasm that remains weak amid mounting job losses and a lingering recession.
Erin Armendinger of the University of Pennsylvania's Wharton School of Business had this to say:
"Customers are still anxious and distressed. When you have unemployment going up towards double digits, that has a huge impact on consumers. Customers are hesitant to buy items they do not need, like luxury items. Even for items that they do need, they are looking for bargains. They are looking for the best value for their money," he said.
U.S. unemployment reached 9.5 percent last month, and most economists say the jobless rate will exceed 10 percent by year's end. But the latest weekly numbers from the Labor Department show improvement. The number of newly laid off Americans filing unemployment claims fell by more than 50,000 last week compared to the previous week. Last week's total - 565,000 - was far less than analysts had anticipated and was the lowest level since the beginning of the year.
The Commerce Department reported that U.S. wholesale inventories fell for a ninth consecutive month in May, reflecting continued production cuts by manufacturers.
Mixed economic data is sowing doubt as to when a recovery will take hold and whether an economic stimulus package enacted in February is working, according to University of Texas economist James Galbraith.
"Right now, there is a kind of a general anxiety about whether the economy is going to recover. It is certainly not going to recover as quickly as the forecasters, the optimists in January thought it would. On the other hand, it has stabilized and there is still a lot of money in the pipeline [stimulus funds yet to be spent]. So there is a considerable amount of uncertainty," he said.
Galbraith was speaking on Bloomberg television.
On Wednesday, the International Monetary Fund predicted that advanced industrialized nations like the United States will return to positive economic growth next year, but that the expansion will be weak.
A broad range of American retailers reported sales declines in June, from well-known apparel stores like Abercrombie and Fitch to bulk-item seller Costco.
Analysts say rainy weather across large sections of the United States further-dampened consumer enthusiasm that remains weak amid mounting job losses and a lingering recession.
Erin Armendinger of the University of Pennsylvania's Wharton School of Business had this to say:
"Customers are still anxious and distressed. When you have unemployment going up towards double digits, that has a huge impact on consumers. Customers are hesitant to buy items they do not need, like luxury items. Even for items that they do need, they are looking for bargains. They are looking for the best value for their money," he said.
U.S. unemployment reached 9.5 percent last month, and most economists say the jobless rate will exceed 10 percent by year's end. But the latest weekly numbers from the Labor Department show improvement. The number of newly laid off Americans filing unemployment claims fell by more than 50,000 last week compared to the previous week. Last week's total - 565,000 - was far less than analysts had anticipated and was the lowest level since the beginning of the year.
The Commerce Department reported that U.S. wholesale inventories fell for a ninth consecutive month in May, reflecting continued production cuts by manufacturers.
Mixed economic data is sowing doubt as to when a recovery will take hold and whether an economic stimulus package enacted in February is working, according to University of Texas economist James Galbraith.
"Right now, there is a kind of a general anxiety about whether the economy is going to recover. It is certainly not going to recover as quickly as the forecasters, the optimists in January thought it would. On the other hand, it has stabilized and there is still a lot of money in the pipeline [stimulus funds yet to be spent]. So there is a considerable amount of uncertainty," he said.
Galbraith was speaking on Bloomberg television.
On Wednesday, the International Monetary Fund predicted that advanced industrialized nations like the United States will return to positive economic growth next year, but that the expansion will be weak.
