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US economic outlook brightens on jobs
US economic outlook brightens on jobs

The outlook for the US economy has brightened a little after new data pointed to improvement in hiring and exports.

The number of Americans applying for unemployment benefits last week fell by 6,000 to a seasonally adjusted 361,000, the government said.

Economists said the modest improvement could carry over into August.

The US trade deficit narrowed to $US42.9 billion ($A40.72 billion) in June from $US48 billion in May, the Commerce Department said in a separate report. That's the lowest level in 18 months.

The drop was largely because of cheaper oil imports. But exports also rose to a record-high $US185 billion, an encouraging sign at a time when global growth has slowed. US companies even sold more goods in Europe, despite the region's ongoing financial crisis.

Some economists revised their growth forecasts higher for the April-June quarter after seeing the better trade data.

"As long as we can keep selling more of our goods across the world, the economy can (grow) at a moderate pace," said Joel Naroff of Naroff Economic Advisors.

"In June, despite all the craziness in Europe and the slowdowns in Asia, our exports managed to increase. "

The economy is looking more resilient after faltering in the spring.

Employers added 163,000 jobs in July, the biggest increase since February. From April to the end of June, employers had created a lacklustre 73,000 jobs a month, not enough to keep up with a rising population.

Applications for unemployment benefits measure the pace of layoffs. When they fall consistently below 375,000, it typically suggests hiring is strong enough to lower the unemployment rate.

Paul Dales, an economist at Capital Economics, said fewer unemployment applications suggested the job market was fairly stable. "The pickup in jobs growth in July may therefore be sustained in August," Dales said.

Still, a third report offered a reminder that the economy remains weak. US wholesalers cut their inventories in June from May after seeing sales fall by the most in three years, the Commerce Department said.

If the trend continues, that could slow factory output and offset some of the benefits from higher exports.