Jobless claims: 496,000 are much worse than expected


The Department of Labor reports:

In the week ending Feb. 20, the advance figure for seasonally adjusted initial claims was 496,000, an increase of 22,000 from the previous week’s revised figure of 474,000. The 4-week moving average was 473,750, an increase of 6,000 from the previous week’s revised average of 467,750.

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Bloomberg said economists had predicted 460,000. So this is significantly above expectations. And it continues the trend of poor initial claims numbers. The chart below shows that the 4-week average has no risen to almost 475,000 from just 440,000 a month ago. While some of this may be seasonal adjustments – as I am quoting the seasonally-adjusted numbers – you still have to be worried that the lack of jobs will mean that consumer demand will falter making a double dip more likely.

Jobless Claims for week ended 20 Feb 2010

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The only bright point here was a fall in the number of people on extended benefits from 5.8 to 5.5 million. However, it is not clear whether this was due to people having found employment or having exhausted benefits.

Stock futures are down on the news, while bonds are up. This is not good.

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