Initial jobless claims for the week ending December 29 were higher than expected with 10,000 new claims added that week. Economists still view the labor market as performing strongly.
Key Takeaways
- 231,000 Americans filed applications for unemployment benefits last week compared to the 220,000 forecast by economists.
- The long-term trend is viewed as positive despite the ongoing volatility in the financial market, with the four-week average at 218,750 claims.
- Data for the week prior was revised upwards to show 5,000 more claims than initially reported.
Data on claims filed by federal employees has been furloughed due to the ongoing US government shutdown brought about by President Donald Trump’s demand for $5 billion in funding to create a wall on the southern border between the US and Mexico.
However, an official from the Labor Department stated that there is no indication at this time that filings from federal employees have increased – this claims data is released one week later than that of non-federal employee claims. In Maryland and Virginia, two states with a high density of federal workers, claims rose and fell respectively.
The more stable monthly average of claims shows a result of 218,750 claims, the lowest level in one and a half months and down 500 last week. The 10,000 claim increase seen last week should therefore be considered with that in mind. Meanwhile, continuing claims rose by 32,000 to 1.74 million while remaining near a 45-year low overall.
With 200,000 new jobs added from January to November 2018, record lows in unemployment, and the US economy in its 10th year of expansion, the labor market is still considered to be in a strong position at the beginning of 2019.
Although rising by 10,000 to 231,000 for the week ending 29 December, initial jobless claims close 2018 near record lows. Claims continue hovering within a narrow range since mid-2018. This is a key real-time indicator of labor markets. pic.twitter.com/6FJvK1zc9G
— Thomas Kevin Swift (@DrTKSwift) January 3, 2019
Expert Outlook
Chief economist Scott Brown of Raymond James said that “figures will remain choppy through the first five to six weeks of the year, although the underlying trend should remain low.”
Market Reaction
Gold climbed today with a spike seen shortly after the release of the jobless claims data. Spot gold is currently trading at $1,290.30/oz and up 0.73% with a daily high of $1,292.36/oz and a low of $1,278.94/oz.
Gold Price Chart
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