Initial jobless claims rose 4,000 to 235,000 last week, vs. the 50+ year low of 166,000 set in March. The 4-week average also rose by 750 to 232,500, compared with the all-time low of 170,500 three months ago.  Continuing claims rose 51,000 to 1,375,000, which is 69,000 above their 50-year low set on May 6:

Initial claims have now been in an uptrend for 3 months, meaning they no longer qualify as a “positive” in my array of short leading indicators.

Last week I noted that reviewing the entire 50+ year history of initial claims, “there are almost always one or two periods a year where the four-week moving average of jobless claims rises between 5% and 10%. About once every other year for the past 50+ years, it rises over 10%. Typically (not always!) it has risen by 15% or more over its low before a recession has begun. And a longer term moving average of initial claims YoY has, with one exception, turned higher before a recession has begun.”

Both initial and continuing claims are continuing to drift higher, and since there is a very long history that initial claims lead the unemployment rate by several months, in tomorrow’s report it would not be surprising if there were a 0.1% increase in the latter:

But initial claims are not a “negative” yet either, since YoY they are still down almost 45%. So they are not signaling recession.

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