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Jobless Claims Rose More Than Expected In the Latest Week

REUTERS
Thursday, 5 Apr 2007 | 10:10 AM ET

New U.S. jobless claims rose a larger-than-forecast 11,000 last week, government data on Thursday showed, in a report adding to the mixed economic picture painted by other recent U.S. indicators.

Initial filings for state unemployment insurance aid for the week ended March 31 increased to a seasonally adjusted 321,000 from an upwardly revised 310,000 the prior week, the Labor Department said.

Reaction from the foreign exchange, stock and bond markets was muted and analysts said the release did not challenge views that the labor market was still on solid ground, despite weakness among U.S. manufacturers and in housing.

"Jobless claims are still running at a relatively low level, and are not what we'd expect to see in a recession, rather in a healthy economy, said Gary Thayer, chief economist with A.G. Edwards & Sons Inc in St. Louis.

"Yes, we're up a bit (on claims). But if we were in a recession we'd be up 400,000 not 300,000. So it suggests to me that the economy is experiencing problems in some spots, but not across the board," he said.

In the week ending March 24, claims had posted a surprisingly steep decline to an initially reported 308,000, and analysts on Wall Street had expected claims to rebound to 315,000 in the latest week.

The four-week moving average of claims, which irons out weekly volatility to provide a better sense of underlying job-market trends, edged lower to 315,750 from 317,250 in the prior week, the lowest reading since early February.

The total number of unemployed still on the benefit rolls after drawing an initial week of aid fell by 25,000 to 2.492 million in the week ended March 24, the latest period for which these figures are available. It had been expected to come in at 2.51 million.

Investors are scrutinizing the jobless data for clues about the tone of the labor market ahead of the monthly March payrolls report, due on Friday, and after disappointing readings from recent business surveys.

Analysts polled by Reuters forecast 120,000 new jobs were created last month compared with 97,000 in February, with the unemployment rate edging to 4.6% from 4.5%.

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