EmailThe labor sector received more encouraging news as the initial claims level remained below the upper bound (410,000) of our "Recovery Zone" for the second consecutive week. Initial claims fell slightly from 401,000 for the week ending July 23 to 400,000 for the week ending July 30. The Briefing.com consensus expected the initial claims level to increase to 405,000.
Declines over the last two weeks came at a time when the Labor Department indicated that there were no special factors impacting the claims data. These moves signal the first real improvement in the labor situation since April.
Furthermore, if claims remain at or below their current level, it could be a sign that the economy is finally beginning to rebound following the temporary factors -- high oil prices, Japanese earthquake and tsunami, China slowdown -- that have been blamed for the economic weakness in the U.S. thus far in 2011.
The continuing claims level increased from 3.720 million for the week ending July 16 to 3.730 million for the week ending July 23. The consensus expected continuing claims to fall to 3.700 million.
