U.S. initial claims inched up just 1,000 to 308,000 in the week ending September 28th after dipping 4,000 to a revised 307,000 (the figure had been 305,000) the previous week. Markets expected a slightly higher 315,000 reading in the latest week.
The four-week moving average of initial claims dropped to 305,000, its lowest level since May 2007. The measure was biased lower earlier in September as computer glitches in some states led to delays in filing claims.
That backlog, however, has now been cleared with today’s report providing, on balance, a "clean" reading. Continuing claims, for the week ending September 21, jumped 104K to 2,925K.
"Beyond September," say experts at RBC Economics, "there is a risk that the shutdown of the federal government, as well as another contentious debate over the arguably more urgent need to raise the debt ceiling, could weigh on business confidence and hiring.
"We assume, however," the bank concludes, "that the shutdown will be relatively short and that the threat of default, and resulting negative fallout for the economy, will be enough to force Congress to agree to an increase to the debt-limit."
