US jobs data fails to dent optimism

The number of Americans filing new claims for unemployment benefits rose last week, but not enough to suggest that the labour market recovery was taking a step back.

Other data showed that the US economy expanded at an annual rate of 0.4 per cent in the fourth quarter, more than the government had previously estimated.

The reports reinforced the view that the US economy perked up in the first quarter, although it still appeared vulnerable to fiscal austerity measures that kicked in early in the year.

While jobless claims increased more than expected last week, they have trended lower this year and remain near five-year lows. Last week, initial claims for state unemployment benefits increased 16,000 to a seasonally adjusted 357,000.