Jobless Claims Drop to a Three-Month Low

Initial jobless claims unexpectedly fell to a three-month low.

Claims dropped 21,000 to 434,000 in the week ending Oct. 23, The Department of Labor said.

The revised figure for the previous week was 455,000.

A survey of analysts by Reuters predicted claims would rise to 453,00 from the previously reported 452,000.

The labor market may improve in the coming months as the holiday season boosts consumer spending.

"Job growth is modest right now, but it should improve," Joel Naroff, president of Naroff Economic Advisors Inc, told Bloomberg News before the report. "People will be surprised at how much better the labor market looks like in six months."

The four-week moving average, a clearer measure of unemployment trends, fell 5,500 to 453,250. The revised average for the previous week 458,750.