Small rise in initial US jobless claims may mask negative trend
By Alexander Bueso
Date: Thursday 17 Dec 2020
(Sharecast News) - Jobless claims in the US rose only slightly over the preceding week, but masked a more worrying underlying trend, some economists said.
According to the Department of Labor, initial unemployment claims for the week ending on 12 December increased by 23,000 to 885,000.
Economists had penciled-in a reading of 780,000.
Meanwhile, the four-week moving average for initial claims, which aims to smooth out the variations in the data from one week to the next, jumped by 34,250 to 812,500.
Secondary unemployment claims, which are those not being filed for the first time and referencing the week before, or that ending on 5 December, dropped by 273,000 to 5.508m.
The rise in initial claims was worse than it might seem, said Ian Shepherdson at Pantheon Macroeconomics.
"That's because seasonal pressures pointed to a clear drop in claims this week [...]
"The seasonals point to little change in claims next week but then a big increase through the year-end into early January, with claims likely to head comfortably over the million mark, last seen in late August; we look for 1.25M in the first full week of January. Continuing claims have now flattened and will follow initial claiims back up. The path of Covid and the state of the economy cannot be separated."
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