US weekly jobless claims fall to two-month low
By Lucia Mutikani
WASHINGTON (Reuters) -The number of Americans filing new claims for unemployment benefits unexpectedly fell last week, touching the lowest level in two months amid ongoing labor market tightness and defying efforts by the Federal Reserve to slow demand.
Initial claims for state unemployment benefits dropped 9,000 to a seasonally adjusted 228,000 for the week ended July 15, the lowest level since mid-May, the Labor Department said on Thursday. Economists polled by Reuters had forecast 242,000 claims for the latest week.
«The claims data show that the labor market remains resilient and businesses have yet to start shedding workers at a rapid pace, despite five percentage points of tightening,» said Rubeela Farooqi, chief U.S. economist at High Frequency Economics in White Plains, New York.
Unadjusted claims fell by 326 to 257,976 last week. Claims surged by 5,059 in California and increased by 4,616 in Georgia. There were also notable rises in filings in South Carolina and Oregon. These were more than offset by significant declines in Michigan, Kentucky, Indiana, New York, New Jersey, Iowa and Illinois.
Though the labor market remains tight, last week's drop in claims was likely exaggerated by difficulties adjusting the data for seasonal patterns. Automakers normally idle plants in July to retool for new models.
But these temporary plant closures do not always happen around the same time, which could throw off the model that the government uses to strip out seasonal fluctuations from the data. Claims, relative to the size of the labor market, are way below the 280,000 level that economists say would signal a significant slowdown in job growth.
The labor market remains tight as companies hoard workers
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