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Initial US jobless claims continue falling at ‘relentless’ pace

Initial weekly jobless claims in the US continued to slip lower at what one economist called a “relentless” pace.

According to the Department of Labor, unemployment claims being filed for the first time retreated from 405,000 for the next to last week to 385,000 for the seven-day stretch ending on 29 May.

Economists had penciled-in a print of 387,000.

However, secondary unemployment claims, which are those not being filed for the first time and referencing the week ending on 22 May in fact rose by 169,000 to 3.77m.

To take note of, initial claims are more closely linked to firings and secondary claims to hirings, so the trend in secondary claims sometimes offers a better clue as to what the monthly non-farm payroll data might yield.

Commenting on Thursday’s data, Ian Shepherdson, chief economist at Pantheon Macroeconomics, labelled the rate of decline as “relentless”.

In a research note sent to clients, he explained that firms which were already hard-pressed to find staff might be more reluctant to let people go.

He also pointed out the recent decision by 25 states to opt-out from the $300 federally-funded enhancement to weekly unemployment benefits.

That, he said, could see the trend between monthly non-farm payrolls and fast falling initial claims reassert itself.

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