WASHINGTON: US home re-sales rose to a 10-month high in July and the number of Americans filing new claims for unemployment benefits fell last week, signalling strength in the economy early in the third quarter.

The growth outlook was further buoyed by other reports on Thursday showing factory activity in the mid-Atlantic region hit its highest level since March 2011 in August while a gauge of future economic activity increased solidly last month.

The National Association of Realtors said existing home sales increased 2.4 per cent to an annual rate of 5.15 million units. That was the highest reading since last September and confounded economists’ expectations for a pullback. Home re-sales have now increased for four straight months after the housing market recovery stalled in the second half of 2013 following a run-up in mortgage rates.

In a separate report, the Labour Department said initial claims for state unemployment benefits fell 14,000 to a seasonally adjusted 298,000 for the week ended Aug 16. That pointed to a sustained improvement in labour market conditions.

The four-week average of claims, considered a better measure of labour market trends as it irons out week-to-week volatility, rose 4,750 to 300,750. But at that level it is consistent with solid job growth and claims are back to pre-recession levels.

The report covered the period during which the government surveyed employers for August’s nonfarm payrolls data.

Published in Dawn, August 22nd, 2014