– by a New Deal Democrat
Initial jobless claims continued to decline after being on an almost relentless upward trend from the spring to early August.
This week, initial claims fell another -5,000 to 213,000 and the 4-week average fell another -8,000 to 224,000. Continuing claims, which are lagging somewhat, rose by 2,000 from a heavily revised 1,401,000 the previous week (1,473,000 were originally reported):
As I wrote last week, ongoing claims are lagging behind initial claims. I expected them to turn lower and they did from a revised high of 1,437,000 on August 20th.
I attribute this to the positive effect of lower gas prices, which I also expect to have a positive effect on consumer confidence and also on Biden’s approval ratings.
The long-term outlook over the coming year remains negative; but I expect this to be confirmed only after the effects of lower gas prices are fully reflected in the coincident and near-term data.