Today's Report (16/12/2021)

In the week ending December 11, the advance figure for seasonally adjusted initial claims was 206,000, an increase of 18,000 from the previous week's revised level. The previous week's level was revised up by 4,000 from 184,000 to 188,000. The 4-week moving average was 203,750, a decrease of 16,000 from the previous week's revised average. This is the lowest level for this average since November 15, 1969 when it was 202,750.

The previous week's average was revised up by 1,000 from 218,750 to 219,750. The advance seasonally adjusted insured unemployment rate was 1.4% for the week ending December 4, a decrease of 0.1 percentage point from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending December 4 was 1,845,000, a decrease of 154,000 from the previous week's revised level. This is the lowest level for insured unemployment since March 14, 2020 when it was 1,770,000.

What Is It?

Jobless claims are a statistic reported weekly by the US Department of Labor that counts people filing to receive unemployment insurance benefits. There are two categories of jobless claims—initial, which comprises people filing for the first time, and continuing, which consists of unemployed people who have already been receiving unemployment benefits.

What Is The Fundamental Effect?

An increasing or decreasing trend suggests a deteriorating or an improving labor market. The lower the number of unemployment claims, the stronger the job market. Generally, numbers standing above 400,000 for several weeks could suggest a danger of falling into a recession.

What Effect Does It Have On The Market?

CURRENCY - A steady climb in initial claims, might turn foreign investors away from US securities, which can weaken the Dollar’s value in foreign exchange markets.

STOCKS - Stocks tend to fare badly when there is an increase in claims. However, such a report has the potential to lower interest rates, which is normally positive for stocks.

BONDS - The higher the figure, the more bullish news it is to Bond investor's ears. A rise points to a weaker economy and diminishing inflation pressures. A continuous drop in claims hints at a sturdier economic climate ahead. More inflation leads to lower bond prices and rising yields.