New unemployment claims are compiled weekly to show the number of individuals who filed for unemployment insurance for the first time. An increasing (decreasing) trend suggests a deteriorating (improving) labor market. The four-week moving average of new claims smoothes out weekly volatility. Why Investors Care
| Released on 8/30/07 For wk 8/25 2007 | ||||||||||||
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Highlights
Initial jobless claims rose 9,000 in the Aug. 25 week to 334,000, the highest level since mid-April. There were no special factors behind the rise which is certain to firm expectations for soft payroll growth in next week's employment report. The four-week average is confirming a softening in the labor market, up 6,250 to 324,500.
Continuing claims are also confirming softening, up 13,000 in the Aug. 18 week to 2.579 million, also the highest since mid-April. The Aug. 18 week is the survey week for the monthly employment report, and a comparison with the July survey week shows a 38,000 increase.
Financial markets were steady after the release which was accompanied by a strong GDP revision. But the claims data, showing clear erosion in the last several weeks, may hurt the dollar and stocks through the session and may give a lift to Treasury prices.
Initial jobless claims edged down 2,000 to a bit higher-than-expected level of 322,000 in the week ending August 18. There were no special factors in the week. The labor market has remained strong though layoffs in the mortgage industry have been piling up in recent weeks. We are likely to start seeing some of the lay-offs in the financial sector start showing up in jobless claims in the upcoming release.
Jobless Claims Consensus Forecast for 8/25/07: 320,000
Range: 310,000 to 330,000
![[Chart]](chart.gif)
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Weekly series fluctuate more dramatically than monthly series even when the series are adjusted for seasonal variation. The 4-week moving average gives a better perspective on the underlying trend. |
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