US initial jobless claims drop more than expected

The number of Americans filing for unemployment benefits fell more than expected last week, according to data from the Labor Department.

US initial jobless claims declined by 19,000 to 238,000, beating expectations for a smaller drop to 247,000.

Meanwhile, the four-week moving average came in at 243,000, up 750 from the previous week.

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.

Pantheon Macroeconomics said: "Seasonal adjustment problems caused by the changing date of the Easter holiday and spring break from year to year mean the claims numbers for individual weeks can't be taken seriously at this time of year. We didn't believe last week's 257K reading and we don't believe this week's 238K; the trend is somewhere in between.

"The key point, though, is that the trend seems not to have moved for some time, consistent with our view that the
reported slowdown in Q1 growth was due to seasonal adjustment problems, weather effects, the late Easter and delayed tax
refunds, rather than marking the start of a sustained softening. The trend in claims is consistent with payroll gains trending over 200K."