US jobless claims see higher-than-expected slump

Initial claims for US unemployment benefits recorded a higher-than-expected retreat in the week ended Aug. 3, while the four-week moving average for new claims, a better measure of labor market trends as it irons out weekly fluctuations, gained ground.

Labor Department data showed today, Aug. 8, that US jobless claims plunged by 17,000 to 233,000 applications for the week. This came against forecasts for a decline to 240,000 applications, from last week’s upwardly-revised reading of 249,000.

Meanwhile, the four-week moving average for new claims advanced by 2,500 to 240,750 applications, from the previous week's revised average of 250,000.

Despite the increase in the four-week average, this data generally reflected a slowdown in the US labor market, especially with the higher number of jobless claims beneficiaries, fueling fears of a slide into a possible recession.

These concerns caused a sharp sell-off in global markets earlier this week after the July jobs report indicated a slowdown in employment.