- Sophia Kearney-Lederman, an economic analyst at FTN Financial
The number of Americans applying for unemployment benefits unexpectedly jumped last week, a sign labour market momentum may be starting to wane. Initial jobless claims rose by 7,000 to 284,000 in the week ended January 9, the second-highest level since July, according to the Labor Department. Economists, however, had predicted a decrease to 275,000. The increase likely reflects volatility rather than a change in labour market conditions, as the data is difficult to adjust during holidays. Claims also tend to increase at the start of each quarter. The four-week moving average of claims, considered a better measure of labour market trends as it strips out week-to-week volatility, increased 3,000 to 278,750 last week. Still, it was the 45th consecutive week that claims remained below the 300,000 mark, which is associated with strong labour market conditions. That is the longest such stretch since the early 1970s. Concerns that a slowdown in China and other emerging economies will limit prospects for US growth have shacked stock markets and may prompt some employers to cut back.
Furthermore, the number of people still receiving benefits after an initial week of aid rose 29,000 to 2.26 million in the week ended January 2. The four-week moving average of the so-called continuing claims increased 5,250 to 2.22 million.
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