Lower U.S. Jobless Claims Suggest Solidly Improving Labor Market
By Lucia Mutikani
(Reuters) - The number of Americans filing new claims for unemployment benefits fell more than expected last week, pointing to a healthy and expanding labor market.
The sustained jobs market strength underscores the economy's solid fundamentals and suggests a recent slowdown in economic activity will be temporary.Harsh weather, the now-settled labor dispute at the country's busy West Coast ports, softer global demand and a strong dollar undercut growth early in the first quarter.
Initial claims for state unemployment benefits dropped 9,000 to a seasonally adjusted 282,000 for the week ended March 21, the Labor Department said on Thursday.
That was the lowest level since mid-February and was better than economists' expectations for a dip to 290,000. A Labor Department analyst said there was nothing unusual in the state-level data.
"The constructive trend in claims in recent weeks suggests that the positive labor market trend is continuing," said Cheng Chen, an economist at TD Securities in New York. The four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week volatility, fell 7,750 to 297,000 last week.
U.S. financial markets were little moved by the data.
The sturdy jobs picture is in stark contrast with dour reports on manufacturing, home building, consumer spending and trade, which have suggested the economy has hit a soft patch.
The tepid growth and persistently low inflation could see the Federal Reserve delaying raising interest rates until later this year. The U.S. central bank has kept its short-term interest rate near zero since December 2008.
The economy added 295,000 jobs in February, marking the 12th straight month that employment gains have been above 200,000, the longest such run since 1994.
Thursday's claims report showed the number of people still receiving benefits after an initial week of aid fell 6,000 to 2.42 million in the week ended March 14.
So-called continuing claims covered the period during which the government surveyed households for March's unemployment rate. Continuing claims rose marginally between the February and March survey periods, suggesting little change in the jobless rate.
The unemployment rate fell to a more than 6-1/2-year low of 5.5 percent in February.
(Reporting By Lucia Mutikani; Editing by Andrea Ricci)