Announced this morning, Initial Jobless Claims were 231,000 for the week ending May 4th, higher than expected and 22,000 higher than the revised figure from the previous week. In addition, Continuing Claims were 1,785,000 for the week ending April 27th, only slightly higher than expected and 17,000 more than the previous week’s revised figure.
Overall, an upside surprise in initial jobless claims from the previous week, reaching levels not seen since last August and a reminder of the cooler than expected payrolls report from last week. Still, initial claims remain in the low 200,000 range, which is a healthy level and well below the 300,000 level considered normal for a well-functioning economy. Meanwhile, continuing claims were only slightly higher than expected and at reasonable levels. As a real-time look into the labor market, these measures indicate the labor market is still intact, but in the coming weeks, bear watching to see if upside surprises continue.
While the Fed has communicated the next move in rates is likely lower, with sticky inflation it may take a while for that to occur without additional slowing in the labor market. As a result, the direction and magnitude of moves in inflation and the labor market will be key for the Fed and the economy in the coming months.
In all, the yield on the 10-year US treasury ticks lower following the report and equity futures are lower as we head into the market open.
This material is intended to be for informational purposes only and is intended for current or prospective clients of Argent Trust Company. This information is obtained from sources believed to be reliable, and its accuracy and completeness are not guaranteed. Information does not constitute a recommendation of any investment strategy, is not intended as investment advice, and does not take into account all the circumstances of each investor. Forward-looking assumptions are Argent Trust Company’s current estimates or expectations of future events or future results based on proprietary research and should not be construed as an estimate or promise of results that a portfolio may achieve. Actual results could differ materially from the results indicated by this information. Investments can go down as well as up. Past performance is not a reliable indicator of future results.
