Jobless claims in the US show rise

THE NUMBER of Americans filing for unemployment benefits increased more than expected last week, but the underlying trend remained consistent with a tightening labour market.

Initial claims for state unemployment benefits rose 20,000 to a seasonally adjusted 245,000 for the week ended December 16, the Labor Department said. Data for the prior week was unrevised. Since mid-October, claims have been confined to a range of 223,000 to 252,000.

Economists polled by Reuters had forecast claims rising to 231,000 in the latest week. Last week marked the 146th straight week that claims remained below the 300,000 threshold, which is associated with a strong labour market. That is the longest such stretch since 1970, when the labour market was smaller.

The labour market is near full employment, with the jobless rate at a 17-year low of 4.1 per cent. Labour market tightness and a strengthening economy encouraged the Federal Reserve to increase interest rates last week for a third time this year. The US central bank has forecast three rate hikes for 2018.

A Labour Department official said claims-taking procedures continued to be disrupted in the Virgin Islands months after Hurricanes Irma and Maria battered the islands. The official said processing of claims in Puerto Rico was still not back to normal.