Good Economic News
The economy is growing, and there is good news about unemployment.
The U.S. economy, propelled by the biggest surge in consumer spending on big-ticket goods in 15 years, grew at an annual rate of 1.4 percent in the final quarter of 2001, the government reported. And the number of new U.S. jobless claims last week was smaller than expected at 378,000, the government said Thursday, while a more reliable barometer of the labor market's health fell to its lowest in more than six months.
First-time claims for state unemployment benefits rose 17,000 in the Feb. 23 week from a sharply downwardly revised 361,000 in the prior week, the Labor Department said. This, however, was not as high as Wall Street's expectations for a rise to 385,000 from the 383,000 originally reported for the Feb. 16 week.
A more solid indicator of labor market trends, the closely watched four-week moving average, fell to 373,250 in the week ended Feb. 23 from 376,250 in the previous week. This was its lowest level since 372,000 in the week of Aug. 11, 2001.
On the economy generally, a bigger-than-expected increase in the gross domestic product could mean that economists will date the end of the recession around the end of last year or the beginning of this year.
The revised reading on fourth-quarter GDP as reported by the Commerce Department is much stronger than the 0.2 percent growth rate estimated by the government a month ago. Many economists were forecasting a revised 0.9 percent rate of advance in the GDP, which measures the total output of goods and services produced within the United States.
The 1.4 percent growth rate marked the economy's strongest performance in a year and came after the economy shrank at a 1.3 percent rate in the third quarter.
The latest reading on GDP comes one day after Federal Reserve Chairman Alan Greenspan told Congress the country is recovering from the recession that began in March. Though the recession may turn out to be one of the country's mildest, Americans shouldn't anticipate a robust rebound, he cautioned.