Latest Economic News Sparks Optimism In U.S.

New reports Thursday showed the U.S. economy may be poised for a rebound. The U.S. trade deficit narrowed more than expected in September as exports rose to record levels, and jobless claims fell to a seven-month low.

Copyright © 2011 NPR. For personal, noncommercial use only. See Terms of Use. For other uses, prior permission required.

GUY RAZ, HOST:

It's ALL THINGS CONSIDERED from NPR News. I'm Guy Raz.

ROBERT SIEGEL, HOST:

And I'm Robert Siegel.

Maybe it's not so bad. That seemed to be the read of investors when they saw today's economic numbers. Better than expected news about unemployment stoked some optimism that the U. S. will avoid a double-dip recession. And stock market recovered a bit from yesterday's drop.

But the news is not as good in Europe, as NPR's Chris Arnold reports

CHRIS ARNOLD, BYLINE: Economists and investors these days are hanging on every bit of new data, looking for signs that the U. S. economic recovery is managing to keep limping ahead. And this morning, the Labor Department said the number of people filing for unemployment fell. That means that jobless claims are at their lowest level in seven months.

DR. NARIMAN BEHRAVESH: This is just one more piece of good news suggesting we will see jobs growth going forward.

ARNOLD: Nariman Behravesh is chief economist at IHS Global Insight. He says on top of the unemployment data, new numbers on the trade deficit also showed improvement. So, taken together...

BEHRAVESH: They confirm the general view that the U. S. economy, while growing slowly, is not in a recession and probably not even close to a recession at this point.

ARNOLD: And what's the danger, though, that if Europe keeps deteriorating, that that's going to pull us back down?

BEHRAVESH: A mild recession in Europe probably won't hurt us very much. But if there's a true financial meltdown in Europe - call it Europe's Lehman moment, referring, of course, to Lehman Brothers collapse three years ago - if Europe goes through something like that, then it would drag us back down into a recession.

ARNOLD: Fed Chairman Ben Bernanke talked about this at a town hall meeting in Texas today. He explained how if countries such as Greece can't pay their debts, that could put tremendous pressure on European banks

DR. BEN BERNANKE: The banks would lose all their money on their balance sheets. And that, in turn, could create a huge amount of financial stress not only in Europe but in the world as a whole. So it's a difficult situation.

ARNOLD: But barring a meltdown, Nariman Behravesh says he's forecasting at least sluggish growth with steady but slow job gains. He thinks the unemployment rate even a year from now will still be up at around 8 or 8.5 percent.

Chris Arnold, NPR News.

Copyright © 2011 NPR. All rights reserved. No quotes from the materials contained herein may be used in any media without attribution to NPR. This transcript is provided for personal, noncommercial use only, pursuant to our Terms of Use. Any other use requires NPR's prior permission. Visit our permissions page for further information.

NPR transcripts are created on a rush deadline by a contractor for NPR, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of NPR's programming is the audio.

Comments

 

Please keep your community civil. All comments must follow the NPR.org Community rules and terms of use, and will be moderated prior to posting. NPR reserves the right to use the comments we receive, in whole or in part, and to use the commenter's name and location, in any medium. See also the Terms of Use, Privacy Policy and Community FAQ.

Support comes from: