Jobless claims drop to lowest level since December 1969

The number of Americans filing for unemployment benefits unexpectedly dropped last week, according to data from the Labor Department.

US initial jobless claims fell by 1,000 from the previous week’s revised level to 204,000, beating expectations for an increase to 210,000 and marking the lowest level since 6 December 1969. The previous week’s level was revised up by 2,000 to 205,000.

Meanwhile, the four-week moving average declined by 2,000 from the previous week’s average to 208,000, also marking the lowest level since 6 December 1969. The previous week’s average was revised up by 500 to 210,000.

The four-week average is considered more reliable as it smooths out sharp fluctuations in the more volatile weekly figures, giving a more accurate picture of the health of the labour market.

Continuing claims - which represent the number of people already collecting unemployment benefits - fell to 1.696m from 1.711m versus expectations for a level of 1.710m, marking the lowest level for insured unemployment since 1 December 1973. The previous week's level was revised up by 4,000.

"The trend is falling, and sub-200K readings are coming, but the numbers for the next few weeks likely will be distorted by Hurricane Florence," said Pantheon Macroeconomics.