US jobless claims stagnate to 3-month low, signal rebound in labor market

The United States jobless claims held steady last week, remaining at a three-month low, indicating the economy’s labor market is recovering after a relatively weak tenure. Unemployment benefits are, however, entering a phase of volatility in the near future, reports claimed.

US jobless claims remained unchanged at 54,000 in the week ended July 9, compared to over four-decade low of 248,000 in April, data released by the United States Labor Department showed Thursday. According to a Bloomberg poll median estimate, jobless claims were expected to register a rise to 265,000.

In addition, the number of people who continues to receive jobless benefits rose to 2.15 million during the week ended July 2. The rate of unemployment among citizens who are eligible for benefits rose 1.6 percent, compared to 1.5 percent previously. Moreover, the latest payrolls data showed that the US economy added 287,000 jobs in June after an 11,000 increase in May, indicating that the country’s labor force is exhibiting signs of improvement.

Though minutes from the June 14 to June 15 Federal Open Market Committee meeting showed policymakers being concerned over the slowdown in May jobs report, central bankers are more focused on the recent progress in the labor market. This indicates that the slight improvement in May employment may be an outlier in this regard.

Meanwhile, due to seasonal instances such as a temporary shutdown of automobile plants to retool for the new model year and other unexpected circumstances, economists and other market participants tend to focus on a rolling monthly average that offsets the weekly fluctuations. The four-week average of claims declined to 259,000, the lowest since the end of April, from 264,750 in the prior period.