The Labor Department’s report on weekly jobless claims continues to go against many of the headlines we are seeing elsewhere. Last week brought a drop to 323,000, the lowest weekly jobless claims in five years, since before the recession took hold. The previous week’s reading of 324,000 was revised slightly higher to 327,000.
Today’s report was better than all economists were calling for. Bloomberg showed an economist range of 326,000 to 341,000. The consensus from both Bloomberg and Dow Jones was 335,000.
Recent bond strength may need to take a breather if the jobless reports are going to keep getting better and better. The FOMC has set an easy money interest rate policy until unemployment returns to 6.5%, and it even raised the threshold on what it would accept for inflation to get the workforce back to where it needs to be.
This was a good report, but it is just a weekly report. The Federal Reserve likely will keep its finger on the “buy button” for quite a bit longer.