The number of Americans filing new claims for unemployment benefits rose more than expected last week, but the underlying trend continued to point to some strength in the labor market.
Initial claims for state unemployment benefits increased 16,000 to a seasonally adjusted 326,000, the Labor Department said on Thursday. Claims for the week ended March 22 were revised to show 1,000 fewer applications received than previously reported.
Economists polled by Reuters had forecast first-time applications for jobless benefits rising to 317,000 in the week ended March 29.
The four-week moving average for new claims, considered a better measure of underlying labor market conditions as it irons out week-to-week volatility, nudged up 250 to 319,500. This indicates a firmer bias in the labor market.
A Labor Department analyst said no states were estimated and there were no special factors influencing the state level data.
The government made revisions to the model it uses to smooth the claims data for seasonal fluctuations. It also revised claims data going back to 2009.
Despite last week's increase, claims have been generally stable in March, which should support expectations of an acceleration in job growth during the month.
The government's closely watched employment report on Friday is expected to show nonfarm payrolls increased by 200,000 jobs last month after rising 175,000 in February, according to a Reuters survey of economists. The unemployment rate is seen falling one-tenth of a percentage point to 6.6 percent.
A report on Wednesday showed private employers stepped up hiring in March for a second straight month.
The labor market suffered a setback in December and January when unseasonably cold weather gripped large parts of the country. With temperatures rising, a pick-up is in the cards, which should help to unleash pent-up demand and put the economy on a stronger growth trajectory.
The claims report showed the number of people still receiving benefits after an initial week of aid rose 22,000 to 2.84 million in the week ended March 22.
Trade gap widens sharply, exports tumble
The U.S. trade deficit unexpectedly widened in February as exports fell to their lowest level in five months, further signs economic growth slowed in the first quarter.
The Commerce Department said the trade gap increased 7.7 percent to $42.3 billion, the largest since September last year. January's shortfall was revised to $39.3 billion from a previously reported $39.1 billion. Economists polled by Reuters had forecast the trade deficit falling to $38.5 billion. In addition to weak exports,
February's rise in the deficit likely reflected an increase in the price of crude oil. Declining petroleum imports as a domestic energy production boom reduces the nation's dependency on foreign oil have helped to shrink the trade deficit. That saw the current account deficit hitting a 14-year low in the fourth quarter of 2013.
Trade was one of the key drivers of economic growth during the last three months of last year, a trend that is unlikely to be repeated in the first quarter.
Growth in the first three months of 2014 is expected to have slowed to an annualized pace below 2 percent. The economy grew at a 2.6 percent rate in the fourth quarter. When adjusted for inflation, the trade gap widened to $50.1 billion in February from $48.5 billion the prior month.
Exports slipped 1.1 percent to $190.4 billion in February. That was the lowest level since September. Imports edged up 0.4 percent to $232.7 billion.
Exports to China fell 4.6 percent in February. Imports from that country tumbled 19.5 percent, narrowing the politically sensitive U.S. trade deficit with the world's second-largest economy to its smallest since March 2013.
The drop in imports was probably due to the Chinese New Year holiday.
--By Reuters