President Obama’s re-election prospects suffered a blow on two fronts Thursday with the news that jobless claims and home foreclosures are both up.
The Labor Department reported that 386,000 people filed new jobless claims in the week ending June 9, up 6,000 from the previous week’s figure. That was 11,000 more than the 375,000 predicted by economists.
It marked the fifth time in six weeks that jobless claims have risen, bad news for the incumbent president when most voters cite the economy as the most important issue going into the November election.
And the news came on the day when President Obama is delivering an address in Ohio asking voters for more time to boost growth.
Labor Secretary Hilda Solis conceded two weeks ago that the 8.2 percent unemployment rate is “unacceptable.”
“The data show that there is skepticism on the part of companies that are hiring,” Peter Cardillo, an economist at Rockwell Global Capital, told CNBC.
Also on Thursday, RealtyTrac reported that foreclosure filings rose by 9.1 percent in May from a month earlier, with 205,990 properties subject to default notices, scheduled auctions or bank repossessions.
Bank repossessions rose 7 percent from April, with 54,844 homes repossessed in May.
Georgia’s foreclosure activity increased by 32.9 percent from April and 30 percent from May 2011, making it May’s leader in foreclosure activity. Arizona, Nevada, California, Illinois, Florida, Ohio, Michigan, South Carolina, and Utah rounded out the top 10 states with the highest foreclosure rates last month.
“The overall tenor of recent economic data has been gloomy,” CNBC observed.
“A combination of the worsening debt crisis in Europe and uncertainty over whether Congress will manage to stave off the scheduled expiration of various lower tax rates at year-end, dubbed the ‘fiscal cliff,’ is souring business and consumer confidence. Job growth has slowed in the past four months, with employers adding the fewest jobs in a year in May.”
Obama will use his campaign speech in the battleground state of Ohio to try to bounce back from a series of recent setbacks, including the poor jobs report and a misstep in which he seemed to play down the economy's woes by saying the private sector was "doing fine." He later told reporters he did not think the overall economy was fine.
Obama risks losing the election if he cannot convince voters that his economic remedies are working.
The president’s approval ratings have slipped to their lowest level since January - from 50 percent a month ago to 47 percent - because of deep economic worries, a Reuters/Ipsos poll showed on Tuesday.
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