This morning saw the weekly jobless claims data reported by the Department of Labor. Claims fell by 31,000 to a level of 473,000. This exceeds the expected drop of only 10,000. The four-week moving average rose by 3,250 to 486,750.
Analysis: Clearly this is a good sign. All of the “chicken littles” have been predicting continued doom and gloom in the economy. A continued weak jobs market has been one of the principal concerns. Frankly, it remains one of my concerns, too.
Today’s number is less important than what happens over the next two weeks. Why? Because one data point does not mark a trend. Nor, do two data points. Two points of information mark a straight line. Three points are needed to get any sort of strong indication one way or another. So I will be anxiously awaiting jobless claims data over the next several weeks.
Importance grade: 10; jobless claims, and their close cousin, the unemployment rate, are the most important pieces of economic data to monitor.
Jason
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