"It's a stable level of claims"
- Yelena Shulyatyeva, an economist at BNP Paribas
The number of Americans who lost their jobs dropped unexpectedly during the last week, supporting the argument for the Federal Reserve to remove its ultra accommodative monetary policy stance earlier than expected. The Labor Department said Thursday that the number of initial claims for state unemployment benefits fell by 10,000 to seasonally adjusted 332,000 in the week ended March 10, down from 348,000 in the preceding week. The figure reached the lowest level since March 2008. The less volatile four-week moving average dropped by 2,750 to 346,750, the lowest level in five years. The overall unemployment rate fell to 7.7% in February, the lowest in four years, compared with 7.9% in January, and the economy added 236,000 jobs, suggesting the labour market is starting to improve substantially.
"It's a stable level of claims," said Yelena Shulyatyeva, an economist at BNP Paribas in New York, which predicted claims would rise to 365,000. "The main issue is the pace of hiring is not picking up. Businesses feel very uncertain about the outlook."
"The job market is gradually improving but not fast enough for the Fed to remove accommodation. We still think a Fed rate hike is a late 2014 to early 2015 event," said Jacob Oubina, a senior economist at RBC Capital Markets in New York.
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