Initial claims for unemployment insurance fell last week returning to levels normally associated with rising job creation.
Applications for jobless benefits sank 23,000 to 340,000 in the week of May 18th, according to the Labor Department in Washington today. Analysts had forecast 345,000 applicants. The prior week was revised up 3,000 to 363,000.
The four week moving average, a more stable measure of labor market trends, shed 500 to 339,500. Except for the first week of May when it reached 338,000, this was the lowest average since the last week of January 2008.
A stronger labor market historically correlates with a four week average below 350,000. The average first dropped below that level in the second week of March. Of the ten weeks since, six have been below, including the last four.
Chief Market Strategist