First-time claims for U.S. unemployment benefits rebounded by more than anticipated in the week ended January 26th, according to a report released by the Labor Department on Thursday, with jobless claims bouncing off a five-year low.
The report showed that initial jobless claims rose to 368,000, an increase of 38,000 from the previous week's unrevised figure of 330,000. Economists had been expecting jobless claims to climb to 350,000.
In the previous week, jobless claims unexpectedly fell to their lowest level since hitting 318,000 in the week ended January 19, 2008.
"Well, it finally happened," said Jennifer Lee, senior economist at BMO Capital. "After declining for 2 weeks in a row due to some seasonality issues, the number of first-time applicants for unemployment insurance in the U.S. jumped in the final week of January."
While bigger than expected, Lee said the rebound was not too shocking, adding, "And it was encouraging that the bounceback did not completely erase the two weekly improvements."
The Labor Department also said the less-volatile four-week moving average edged up to 352,000, an increase of 250 from the previous week's unrevised average of 351,750.
Continuing claims, a reading on the number of people receiving ongoing unemployment assistance, rose to 3.197 million in the week ended January 19th from the preceding week's revised level of 3.175 million.
Meanwhile, the four-week moving average of continuing claims fell to 3,192,250, a decrease of 9,750 from the preceding week's revised average of 3,202,000.
"Claims are still trending near their lowest levels since 2008, which is good news," Lee said. "Watch for more special factors in the next couple of weeks, though. Power outages in parts of southern and central U.S. yesterday may, just may, have an impact."
Friday morning, the Labor Department is scheduled to release its closely watched monthly employment report for January.
Economists expect the Labor Department report to show an increase of about 180,000 jobs in January following the addition of 155,000 jobs in December.
The continued job growth is expected to push the unemployment rate down to 7.7 percent from 7.8 percent in the previous month.
by RTT Staff Writer
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