Jobless claims fall, jobs market slowly healing

Thu Feb 2, 2012 9:02am EST
 
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WASHINGTON (Reuters) - New claims for unemployment benefits in the United States fell more than expected last week, pointing to more healing in the nation's battered jobs market.

Initial claims for state unemployment benefits dropped 12,000 to a seasonally adjusted 367,000, the Labor Department said on Thursday.

Job growth has gained momentum in recent months and the unemployment rate dropped to a near three-year low of 8.5 percent in December.

Analysts will be watching Friday's report on January payrolls for insight into what it will mean for policy after the Federal Reserve last week left the door open to additional economic stimulus.

"This is certainly a positive in front of non-farm payrolls and further supports the view that the U.S. economy is creating more jobs with the prospect for a lower unemployment rate," said Michael Woolfolk, a currency strategist at BNY Mellon in New York.

Analysts polled by Reuters before Thursday's data expected the payrolls report would show the unemployment rate holding steady at 8.5 percent.

U.S. stock futures erased losses to turn positive after the data, while Treasury debt prices pared gains.

Economists polled by Reuters had forecast claims falling to 375,000. Claims have been lower than 400,000 for eight of the last 10 weeks, holding below a level associated with labor market healing.

The four-week moving average for initial claims, a trend measure that smooths out volatility, fell 2,000 to 375,750.   Continued...

 
<p>Job seekers stand in line to speak with an employer at a job fair in San Francisco, November 9, 2011. REUTERS/Robert Galbraith</p>