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Free AccessMNI DATA ANALYSIS: US Jobless Claims Rise 2k; 1Q ULC +2.7%>
--1Q Nonfarm Productivity +0.7%, Output +2.8%, Hours Worked +2.1%
--International Trade Gap -$49.0b in March, Census Goods Gap Now -$68.3b
--Initial Claims Four-Wk Average -7,750 To 221,500, Low Since March 1973
By Kevin Kastner, Sara Haire and Holly Stokes
WASHINGTON (MNI) - Initial claims U.S. state unemployment benefits
rose by only 2,000 to 211,000 in the April 28 week, well below the
225,000 level expected by analysts in an MNI survey and suggesting that
last week's dip to 45-year low was not a fluke, data released by the
Labor Department Thursday showed.
In other data released at the same time, nonfarm productivity rose
by 0.7% in the first quarter, a slightly smaller gain than the 0.9% rise
expected. Unit labor costs rose by 2.7%, a slower pace than the 3.0%
gain expected, but still up from the 2.1% increase in the previous
quarter.
On a year/year basis, nonfarm productivity was up 1.3% in the first
quarter, a slightly faster pace than the 1.2% year/year rate in the
fourth quarter. Unit labor costs rose 1.1% year/year in the first
quarter, slower than the 1.6% gain in the previous quarter. However,
that slowdown was due in large part to base effects from a 4.8%
quarter/quarter surge in the first quarter of 2017.
Also, the Commerce Department released the international trade data
for March, which showed the overall goods and services gap narrowed to
$49.0 billion from $57.7 billion in February. Analysts had expected the
overall gap to narrow to $49.8 billion, based on a significant
improvement in the advance trade goods gap.
--CLAIMS FOUR-WEEK AVERAGE ANOTHER 45-YEAR LOW
The four-week moving average for initial claims, which tends to be
a better measure of the underlying trend of the data, fell by 7,750 to
221,500 in the April 28 week a second straight decline that takes the
average to its lowest point since the March 3, 1973 week, when it was
slightly lower at 221,250.
Even that low could be breached next week. If the number of
headline claims does not change next week and there are no revisions to
data from the past four weeks, the four-week average will fall by 5,500
as the 233,000 level in the April 7 week rolls out of the calculation.
Seasonal adjustment factors had expected a decrease of 7.7%, or
15,470, in unadjusted claims. Instead, unadjusted claims fell by 14,016
(7.0%) to 186,049. The current week's level was well below the 210,955
level in the comparable week a year ago.
The only states where claims were estimated were again Colorado and
Maine. However, the claims taking procedures in the Virgin Islands and
Puerto Rico have still not returned to normal.
--CONTINUING CLAIMS PLUNGE
The level of continuing claims fell by 77,000 to 1.756 million in
the April 21 week, a third straight decline that returns the level to
its lowest point since the December 8, 1973 week, when it was 1.717
million.
Before seasonal adjustment, continuing claims fell by 129,463 to
1.735 million, well below the 1.949 million level seen in the comparable
week last year.
The four-week average for continuing claims, a more reliable
measure when the continuing claims are rapidly moving week-to-week, fell
by 15,500 to 1.833 million, the lowest point since the December 29,
1973.
The seasonally adjusted insured unemployment rate fell to 1.2% in
the April 21 week, down from 1.3% in the previous week and 1.4% in the
same week a year earlier.
The unemployment rate among the insured labor force is well below
that reported monthly by the Labor Department because claims are
approved for the most part only for job losers, not the job leavers and
labor force reentrants included in the monthly report.
--NONFARM PRODUCTIVITY LIFTED BY SLOWER HOURS
The output component of nonfarm productivity rose 2.8%, slower than
the revised 3.7% increase in the previous quarter, while hours worked
growth slowed even faster to 2.1% from 3.3%.
First quarter hourly compensation rose 3.4% after a 2.4% gain in
the previous quarter, but real hourly compensation still fell 0.1% after
a 0.8% decline in the fourth quarter, showing wage growth is still being
outpaced by inflation.
Productivity growth was revised up to a 0.3% pace in the fourth
quarter from the flat reading previously reported. At the same time,
unit labor costs are now up 2.1% in the fourth quarter, compared with
the 2.5% gain most recently reported.
--GOODS TRADE GAP REVISED MODESTLY WIDER
The census goods trade gap for March was revised slightly wider to
$68.3 billion from the $68.0 billion gap previously reported that was
used when calculating the advance reading for first quarter GDP, while
the February gap was adjusted less than $0.1 billion narrower. As a
result, the net export gap could be adjusted slightly wider in the
second estimate for GDP.
Exports expanded to a record high $208.5b level on solid gains in
capital goods (+$1.9b, aircraft +$1.9b) foods and feeds (+$1.0b),
industrial supplies (+$0.9b), and consumer goods (+$0.1b), offset by a
autos (-$0.6b).
Imports declined, with decreases in capital goods (-$1.5b),
consumer goods (-$0.9b), industrial supplies (-$0.7b) and foods and
feeds (-$0.4b). Auto imports (+$0.2b) posted a small gain.
The country data showed wider bilateral gaps with the EU, Mexico
and Japan, but a smaller gap with China and a small surplus with Canada.
** MNI Washington Bureau: 202-371-2121 **
[TOPICS: MAUDS$,M$U$$$,MAUDR$]
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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.