- by New Deal democrat
Obviously this morning’s PPI number was the most important report of the day. I want to get to that later, but first let’s update the jobless claims situation.
The good numbers in initial claims continued, as they declined -3,000 to 224,000. The four week moving average increased 750 to 221,750. But continuing claims continued elevated, down -15,000 to 1.953 million, still close to its 3.5+ year high:
On the YoY% basis more important for forecasting, initial claims were down -1.8%, and the four week average down -6.2%, while continuing claims were up 4.8%:
As per usual, this is not recessionary and indicates continued expansion.
Comparing initial, and initial + continuing claims with the unemployment rate YoY suggests that the latter should continue essentially unchanged from year ago levels in the coming month or two:
Since the unemployment rate last August through October was 4.1% and 4.2%, that suggests it will continue in that range in the next month or two.
Why are initial and continuing claims moving in opposite directions? As I discussed last week, there are two reasonable explanations. One is that there is some unresolved seasonality at work having to do with layoffs and rehiring in education. The other is that the recent deportation jihad against Latino immigrants means they are not showing up for work, or making jobless claims, meaning that employers are hanging on to their remaining workers more tightly even if their work orders are slackening.
