Initial Jobless Claims totaled 434k, well below expectations of 455k and down from 455k last week. Taking out the July 4th holiday distortion to the early July reading of 427k, today’s figure is the lowest since Aug ’08. Smoothing out the data has the 4 week average down to 453k from 459k last week. The Labor Dept is saying the non seasonally adjusted gain of 3% the week after Columbus Day holiday is usually more than twice that and thus there was a drop in the seasonally adjusted figure. Continuing Claims up to 26 weeks fell to the lowest since Nov ’08 and Extended Benefits fell a net 414k. Bottom line, the drop in initial claims is very encouraging and hopefully sustainable but because of seasonal adjustment issues, let’s wait one more week before we conclude today is the beginning of a trend. The next part of the equation though is job hiring which maybe after next week, companies will get more clarity on both fiscal and monetary policy.
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