US Jobless Claims Drop to 15 Year Low

The number of Americans filing new claims for unemployment benefits tumbled last week to its lowest level in nearly 15 years, adding to bullish signals on the labor market.

Initial claims for state unemployment benefits dropped 43,000 to a seasonally adjusted 265,000 for the week ended Jan. 24, the lowest since April 2000, the Labor Department said on Thursday. It was the biggest weekly decline since November 2012.

The drop, which far exceeded economists’ expectations for a fall to only 300,000, probably exaggerates the strength of the jobs market as the data included the Martin Luther King holiday, which means fewer claims were likely processed.

 
It unwound the prior weeks’ increases, which had pushed claims above the key 300,000 threshold. Economists had largely dismissed that rise as “noise,” noting difficulties adjusting the data for seasonal fluctuations at the start of the year.

U.S. stock index futures added slightly to gains on the data, while the dollar and prices for U.S. Treasury debt were little changed.

via Reuters

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza