A day ahead of the release of the more closely watched monthly jobs report, the Labor Department released a report on Thursday showing first-time claims for U.S. unemployment benefits rose by more than expected in the week ended March 30th.
The report said initial jobless claims climbed to 221,000, an increase of 9,000 from the previous week’s revised level of 212,000.
Economists had expected jobless claims to inch up to 214,000 from the 210,000 originally reported for the previous week.
With the bigger than expected increase, jobless claims reached their highest level since hitting 225,000 in the week ended January 27th.
The Labor Department said the less volatile four-week moving average also crept up to 214,250, an increase of 2,750 from the previous week’s revised average of 211,500.
Meanwhile, the report said continuing claims, a reading on the number of people receiving ongoing unemployment assistance, fell by 19,000 to 1.791 million in the week ended March 23rd.
The four-week moving average of continuing claims also edged down to 1,799,750, a decrease of 750 from the previous week’s revised average of 1,800,500.
“The claims data and other labor market indicators are consistent with a job market that is still quite healthy,” said Nancy Vanden Houten, Lead US Economist at Oxford Economics.
“The Fed doesn’t require a significant weakening in the labor market to begin cutting interest rates but does need to be confident the job market is balanced enough to support slower wage growth,” she added. “However, based primarily on recent inflation data, we have pushed the timing of the first rate cut in our forecast from May to June.”
On Friday, the Labor Department is scheduled to release its more closely watched monthly employment report for March.
Economists currently expected employment to jump by 200,000 jobs in March after surging by 275,000 jobs in February, while the unemployment rate is expected to hold at 3.9 percent.
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