Jobless claims up slightly; four-week average at 44-year low

[May 25, 2017]  WASHINGTON, May 25 (Reuters) - The number of Americans filing for unemployment benefits rose less than expected last week and the four-week moving average of claims fell to a

44-year low, suggesting further tightening in the labor market.

Initial claims for state unemployment benefits increased 1,000 to a seasonally adjusted 234,000 for the week ended May 20, the Labor Department said on Thursday. The increase followed three straight weeks of declines.

Data for the prior week was revised to show 1,000 more applications received than previously reported. Economists polled by Reuters had forecast first-time applications for jobless benefits rising to 238,000 in the latest week.

It was the 116th straight week that claims were below 300,000, a threshold associated with a healthy labor market.

That is the longest such stretch since 1970, when the labor market was smaller. The labor market is near full employment, with the jobless rate at a 10-year low of 4.4 percent.

A Labor Department official said there were no special factors influencing last week's data and that only claims for Louisiana and North Dakota had been estimated.

The four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week volatility, fell 5,750 to 235,250 last week, the lowest level since April 1973.

Labor market strength supports the view that an abrupt slowdown in economic growth in the first quarter was probably temporary, which could encourage the Federal Reserve to raise interest rates next month.

Job seekers fill out applications during the 11th annual Skid Row Career Fair the Los Angeles Mission in Los Angeles, California, U.S. on May 31, 2012. REUTERS/David McNew/File Photo

Minutes of the U.S. central bank's May 2-3 policy meeting, which were published on Wednesday, showed while policymakers agreed they should hold off hiking rates until they see evidence that the moderation in growth was transitory, "most participants" believed "it would soon be appropriate" to increase borrowing costs.

Gross domestic product increased at a 0.7 percent annualized rate in the first quarter, the weakest performance in three years.

Thursday's claims report also showed the number of people still receiving benefits after an initial week of aid rose 24,000 to 1.92 million in the week ended May 13. Despite the increase, the so-called continuing claims have remained below 2 million for six straight weeks.

The four-week moving average of continuing claims dropped 16,000 to 1.93 million, the lowest level since January 1974. The continuing claims data covered the period of the household survey, from which May's unemployment rate will be derived.

The four-week average of continuing claims decreased 76,750 between the April and May survey weeks, suggesting further improvement in the unemployment rate. The jobless rate has dropped by four-tenths of a percentage point this year.

(Reporting by Lucia Mutikani; Editing by Paul Simao)

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