U.S. Jobless Claims Rose Higher Than ExpectedBy Reuters | Posted 07-24-2008
The number of U.S. workers filing new claims for jobless benefits jumped 34,000 last week, government data on Thursday showed, reflecting seasonal volatility typical at this time of year.
Initial claims for state unemployment insurance benefits rose to a seasonally adjusted 406,000 in the week ended July 19, from a revised 372,000 the prior week, the Labor Department said. It was the highest reading since late March.
A Labor Department official noted that estimates were being impacted by annual auto plant shutdowns, the end of the quarter, and the shorter July 4 holiday reporting week.
U.S. Treasury bond prices, which generally benefit from signs of economic weakness, extended gains on the news. The dollar pared gains against the euro and extended losses against the yen.
"This jump reflects the continuing effects of a deeply abnormal auto re-tooling season," said Ian Shepherdson at High Frequency Economics.
Analysts polled by Reuters had forecast 376,000 new claims versus a previously reported count of 366,000 the week before.
The four-week average of new jobless claims, a better gauge of underlying labor trends because it irons out week-to-week volatility, rose to 382,500 from 378,000 the week before.
This measure has risen steadily as the U.S. housing slump chilled growth and crimped hiring.
The number of people remaining on the benefits roll after drawing an initial week of aid declined 9,000 to a lower-then-forecast 3.107 million in the week ended July 12, the most recent week for which data is available.
Analysts estimated so-called continued claims would be 3.14 million. It was the 13th straight week that claims were above 3 million, in a sign that the slowing economy is making it harder for U.S. workers to find jobs.
"From our perspective, this was not completely unexpected given the layoffs and given the economic situation we are in," said Andrew Richman Managing Director at Suntrust's Personal Asset Management division in West Palm Beach, Florida.