The 405 Club

If we use my rule that three weeks makes a trend, then the trend in new unemployment claims is something to worry about. This week’s Unemployment Insurance Weekly Claims Report was another disappointment, marking three weeks of unwelcome increases. New claims came in at 500k, the worst since the November 14th reading, when the bad numbers were falling. Last week was revised up 4k. This was outside of the Bloomberg consensus range of 465k to 495k. From the report:

In the week ending Aug. 14, the advance figure for seasonally adjusted initial claims was 500,000, an increase of 12,000 from the previous week’s revised figure of 488,000. The 4-week moving average was 482,500, an increase of 8,000 from the previous week’s revised average of 474,500.

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Ouch. Most people had hoped that last week’s rise in new unemployment claims would prove to be a short spike. That turned out not to be the case when the number continued to rise. This week’s Unemployment Insurance Weekly Claims Report disappointed nearly everyone with new claims coming in at 484k. This is the worst number in about 5 months. Last week’s bad number was revised up 3k. This was outside of the Bloomberg consensus range of 460k to 470k. From the report:

In the week ending Aug. 7, the advance figure for seasonally adjusted initial claims was 484,000, an increase of 2,000 from the previous week’s revised figure of 482,000. The 4-week moving average was 473,500, an increase of 14,250 from the previous week’s revised average of 459,250.

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This week’s Unemployment Insurance Weekly Claims Report is similar to last week’s. New claims fell fast on an adjusted basis, but grew fast on an unadjusted basis. There is one critical difference: the adjusted number of new claims has hit a new low since the peak. That’s right, actual progress for the first time in months. The new claims number dropped to 429k while last week’s number was revised up 4k. New claims were at the low end of the Bloomberg consensus range of 420k to 460k, though this is widely being reported as a solid trouncing of expectations (another similarity to last week). From the report:

In the week ending July 10, the advance figure for seasonally adjusted initial claims was 429,000, a decrease of 29,000 from the previous week’s revised figure of 458,000. The 4-week moving average was 455,250, a decrease of 11,750 from the previous week’s revised average of 467,000.

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The seasonal adjustments were kind to this week’s Unemployment Insurance Weekly Claims Report. The new claims number dropped to 454k while last week’s number was revised up 3k. Another report and we are again close to where we were 2 weeks prior (457k). New claims were at the low end of the Bloomberg consensus range of 450k to 475k, though this is widely being reported as a solid trouncing of expectations. From the report:

In the week ending July 3, the advance figure for seasonally adjusted initial claims was 454,000, a decrease of 21,000 from the previous week’s revised figure of 475,000. The 4-week moving average was 466,000, a decrease of 1,250 from the previous week’s revised average of 467,250.

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