U.S. Jobless Claims Unexpectedly Slip To Nearly Eleven-Month Low

(RTTNews) - With the more closely watched monthly jobs report looming, the Labor Department released a report on Wednesday unexpectedly showing another modest decrease by first-time claims for U.S. unemployment benefits in the week ended January 4th.

The report said initial jobless claims slipped to 201,000, a decrease of 10,000 from the previous week's unrevised level of 211,000. Economists had expected jobless claims to rise to 218,000.

The unexpected dip pulled jobless claims down to their lowest level since hitting 200,000 in the week ended February 17, 2004.

"Seasonal factors likely weighed on the headline figure, but the low level of initial claims corroborates yesterday's JOLTS data which were consistent with a labor market with few layoffs," said Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics.

The Labor Department said the less volatile four-week moving average also fell to 213,000, a decrease of 10,250 from the previous week's unrevised average of 223,250.

Meanwhile, the report said continuing claims, a reading on the number of people receiving ongoing unemployment assistance, rose by 33,000 to 1.867 million in the week ended December 28th.

The four-week moving average of continuing claims still edged down to 1,865,500, a decrease of 3,000 from the previous week's revised average of 1,868,500.

"Continued claims are off their recent peak but are still elevated, which is not a surprise," said Vanden Houten. "While layoffs remain low, hiring [also remains] at depressed levels, making it difficult for those who have lost their jobs to find new employment.

On Friday, the Labor Department is scheduled to release its more closely watched monthly employment report for December.

Economists currently expect employment to increase by 154,000 jobs in December after jumping by 227,000 jobs in November, while the unemployment rate is expected to hold at 4.2 percent.