Thursday, August 10, 2023

Initial jobless claims: a little soft, but continued expansion signaled


 - by New Deal democrat

I’ll put up an analysis of this morning’s CPI later. In the meantime, initial jobless claims rose 21,000 last week to 248,000. The more important 4 week moving average rose 2,750 to 231,000. With a one week delay, continuing claims declined -8,000 to 1.684 million:

On an absolute level, all of this remains very good.

The YoY% changes are more important for forecasting purposes. There, for the week initial claims are up 15.9% YoY. However, the 4 week moving average is only up 7.9% - far too low an increase to be consistent with any imminent recession. Continuing claims remain very elevated YoY, up 24.6%:

Remember, because YoY claims did not cross the 12.5% threshold for 2 full months, we re-set the clock. While claims suggest a slight increase in the unemployment rate on the order of 0.2%-0.3% in the next few months, that is not nearly enough to trigger the Sahm Rule.

In short, a little softness, but no recession signaled.