US jobless claims hit lowest level in more than three months

Americans filed unemployment claims at a decelerated clip in the seven days ended 7 January, hitting their lowest level in more than three months.

According to the Labor Department, weekly initial jobless claims fell by 1,000 to 205,000, well and truly short of the 215,000 figures expected on the Street, adding to recent evidence of a tight labour market. The main increases were seen in California and New York.

The four-week moving average, which aims to strip out week-to-week volatility, fell by 1,750 to 212,500, while on a non-seasonally adjusted basis, initial claims rose by 60,799 to 339,286. Secondary unemployment claims meanwhile fell by 63,000 to 1.63m over the week ended 31 December.

However, Pantheon Macroeconomics' Ian Shepherdson noted: "The near-flat jobless claims print today is the product of favourable seasonals, again. The surge in Challenger job cut announcements in recent months means that claims will rise across the first half of the year, at least, but predicting the exact timing of the lift-off is difficult, and in any event, the numbers from Thanksgiving through mid-Jan are even less reliable than usual; seasonals can't cope with the holidays."

Reporting by Iain Gilbert at Sharecast.com