The number of Americans filing for unemployment benefits rose to a five-month high last week, but those figures alone likely do not signal a deterioration in the labour market as the underlying trend remained consistent with tightening conditions.
Figures released by the U.S. Labor Department revealed that initial claims for state unemployment benefits increased 13,000 to a seasonally-adjusted 282,000 for the week ended Dec. 5, the highest level since early July.
The four-week moving average of claims, considered a better measure of labour market trends as it strips out week-to-week volatility, rose only 1,500 to 270,750 last week.
Claims have now been below the 300,000 threshold, which is normally associated with healthy labor market conditions, for 40 straight weeks, the longest stretch since the early 1970s.
Labour market tightness is expected to spur faster wage growth and gradually push inflation toward its target. The government reported last week that the economy added 211,000 jobs last month, keeping the unemployment rate at a seven-and-a-half-year low of 5%.
