Some Day The Positive Trend In Unemployment Claims Will End, But Not This Week

As per usual on Thursdays, let’s take a look at the very good short leading indicator of jobless claims.

The bullet point take is that they continue to be among the most positive indicators of all at the moment. Last week only 206,000 people filed initial claims, down -6,000 from the week before. The four week moving average increased 4,250 to 204,000. And with the typical one week lag, continuing claims rose 18,000 to 1.799 million:

All of these continue at historically very low levels.

On the YoY% basis more important for forecasting, initial claims were down -11.6%, the four week moving average down -9.5%, and continuing claims down -8.1%:

This continues to be very positive for the economy.

Finally, let’s take our first look at what this likely means for the unemployment rate beginning in September:

Note this week instead of the usual representation of the unemployment rate, which is rounded to the first decimal, I used the actual numbers that make up the rate, showing how it has declined fairly consistently since the end of last year. The input from jobless claims suggests that there is still room for the unemployment rate to decline further, to 4.0% or even lower, and very little chance of any significant increase.