U.S. jobless claims hit five-week low amid tight labour market

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WASHINGTON (May 23): Filings for U.S. unemployment benefits unexpectedly dipped to a five-week low, offering a fresh sign the job market remains historically tight, amid other mixed signals on the economy.

Jobless claims fell 1,000 to 211,000 in the week ended May 18, according to Labor Department figures released Thursday that were below the median estimate of economists. The four-week average, which is typically a less volatile measure, declined to 220,250.

Key Insights

The third straight drop in claims suggests the labor market is still healthy, amid the lowest unemployment rate in almost a half-century and steady wage gains. 

A separate report last week showed Americans are confident about their finances and the economy, with consumer sentiment jumping to a 15-year high in May. 

The latest claims figures may be scrutinized more than usual, because the week included the 12th of the month, making it the reference period for the Labor Department's monthly jobs report. Those figures will be released June 7. 

April data on new home sales due later Thursday morning, along with durable-goods figures on Friday, will help flesh out a somewhat mixed picture of the U.S. economy at the start of the second quarter. 

Reports last week showed retail sales and factory output both were weaker than expected in April, while President Donald Trump's ratcheting-up of the trade war with China threatens to slow growth further.

Continuing claims, which are reported with a one-week lag, rose by 12,000 to 1.676 million in the week ended May 11. The unemployment rate among people eligible for benefits held at 1.2%. 

Economists surveyed by Bloomberg had forecast an increase in weekly claims to 215,000 from 212,000. Ohio had the biggest increase in unadjusted claims last week, with filings jumping 73% to 10,001.