Data released on Thursday showed an unexpected increase in initial jobless claims last week. Analysts at Wells Fargo point out that despite the increase, the four-week average is moving lower. They point out that strengthening activity should lead to a marked improvement in labor conditions in the next few months.
Key Quotes:
“Initial jobless claims rose unexpectedly the week ending March 13 to a four-week high of 770K. Despite the increase, the four-week average fell as the labor market continues to improve, albeit in fits and starts.”
“The past week’s figure overlaps with the survey week for the March employment report. Since the February survey week, new filings fell by 64K, which remains consistent with hiring ramping up further in March.”
“With more fiscal support starting to hit household bank accounts this week, rising vaccination rates and milder weather, strengthening activity should drive claims lower. That said, the rapidly changing economic environment will keep businesses in adjustment-mode and claims elevated for a while.”
“The Philadelphia Fed’s Business Outlook Survey soared to 51.8, that is the highest reading for this bellwether since it’s all-time high in March 1973. The outlook is undoubtedly brightening here. One month does not make a trend, but let’s call this what it is: euphoria not seen in a generation.”
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