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Jobless Rate Rises While GDP Rebounds

Economic growth balances looming threat of inflation

By Wesley Oliver,  Newser Staff

Posted Aug 3, 2007 12:44 PM CDT

(Newser) – The unemployment rate increased slightly in the second quarter, but the GDP recovered after a lackluster first quarter, providing Wall Street with a mixed report card of the nation’s economy as the Fed meets to determine interest rates. Unemployment ticked up 0.1% to 4.6%, hastened by losses in manufacturing, construction, and government, the WSJ reports.

The GDP grew to 3.4% in the second quarter, and economists are hopeful increased consumer spending will spark even more growth—joblessness is still hovering around 6-year lows. The economy is expected to grow by about 2.5%, and the balance between growth and inflation risk may lead to an interest rate cut at the Fed meeting next week.

Workers toil on the framework of a new, single-family home being built in the foreground as completed homes hang on a hillside in the background in a development in the east Denver suburb of Aurora, Colo.,in this April 14, 2007 file photo. The nation's unemployment rate edged up to...
Workers toil on the framework of a new, single-family home being built in the foreground as completed homes hang on a hillside in the background in a development in the east Denver suburb of Aurora, Colo.,in...   (Associated Press)
Ford Motor Company employees work on the chassis for the 2008 Ford Taurus and Mercury Sable, Friday, June 22, 2007 at the Chicago Assembly Plant where they are being built. New hiring in the areas of education, health services, leisure and hospitality and government drove overall job growth last month....
Ford Motor Company employees work on the chassis for the 2008 Ford Taurus and Mercury Sable, Friday, June 22, 2007 at the Chicago Assembly Plant where they are being built. New hiring in the areas of...   (Associated Press)
Specialist Gregg Maloney, left, and his clerk work at their post on the floor of the New York Stock Exchange, Wednesday April 4, 2007. Wall Street caught its breath Wednesday after the previous session's big advance, barely moving amid a mix of economic data and a drop in oil prices....
Specialist Gregg Maloney, left, and his clerk work at their post on the floor of the New York Stock Exchange, Wednesday April 4, 2007. Wall Street caught its breath Wednesday after the previous session's...   (Associated Press)
Traders talk on the floor of the New York Stock Exchange, Wednesday April 4, 2007. Wall Street caught its breath Wednesday after the previous session's big advance, barely moving amid a mix of economic data and a drop in oil prices. (AP Photo/Richard Drew)
Traders talk on the floor of the New York Stock Exchange, Wednesday April 4, 2007. Wall Street caught its breath Wednesday after the previous session's big advance, barely moving amid a mix of economic...   (Associated Press)
ped companies' need for workers. (AP Photo/Paul Sakuma, file)
ped companies' need for workers. (AP Photo/Paul Sakuma, file)   (Associated Press)
Danielle Pierre waits in line to talk with a prospective employer at the NAACP Executive Diversity Job Fair in this May 22, 2007 file photo in New York. Employers showed a decent appetite to hire in May, boosting payrolls by 157,000, the most in two months. The unemployment rate...
Danielle Pierre waits in line to talk with a prospective employer at the NAACP Executive Diversity Job Fair in this May 22, 2007 file photo in New York. Employers showed a decent appetite to hire in...   (Associated Press)
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inflation • Wall Street • economic growth • Federal Reserve • construction • unemployment • consumer spending • US economy • GDP • manufacturing • interest rate

 
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