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US jobless rate to rise further before retreat: Treasury Secretary

(Xinhua)
Updated: 2010-08-04 02:13

WASHINGTON - US Treasury Secretary Timothy Geithner said on Tuesday that the country's unemployment rate may rise further before falling back.

"It's possible you're going to have a couple months where it goes up," he said on ABC's "Good Morning America" program. "People start to come back into the labor force, and that can cause the measured unemployment rate to go up temporarily."

The unemployment rate counts only those who are actively looking for work, not those who have given up the search. US jobless rate fell 0.2 percentage points to 9.5 percent in June, mainly because fewer people were searching for jobs amid disappointing economic prospect.

But Geithner expected more people to rejoin the labor force as private payrolls expanded at an average of about 100,000 per month during the first half of this year.

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The US Labor Department is scheduled to release its employment report on Friday. Economists forecast the jobless rate would rise to 9.6 percent in July.

Federal Reserve Chairman Ben Bernanke did not see any quick improvement in the job market either.

"Significant time will be required to restore the nearly 8.5 million jobs that were lost over 2008 and 2009," he said on Monday in a speech to lawmakers in Charleston, South Carolina.

In an opinion piece on Tuesday in The New York Times, Geithner said: "While the economy has a long way to go before reaching its full potential, last week's data on economic growth show that large parts of the private sector continue to strengthen."

US economy grew at a 2.4-percent annual rate in the second quarter of this year, a deceleration from an increase of 3.7 percent in the first quarter of 2010 and 5.0 percent in the last three months of 2009, according to the preliminary estimate by the Commerce Department released last week.