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First Cut: Initial jobless claims little changed in May 18 week, underlying trend remains low

Initial jobless claims for the week ended May 18 edged down 1,000 to 211,000, reflecting an underlying trend of persistent low levels of applications for benefits as businesses hold on to workers in spite of signs of increased risks to the economic outlook.

No states estimated claims in the week and the Labor Department cited no special factors.

The four-week moving average declined to 220,250 in the May 18 week from 255,000 in the prior week as the more elevated readings of late April moved through the data and as noise abates. There may be some fresh mismatches in seasonal adjustment in the next few weeks due to the Memorial Day holiday and the winding down of school years. Both these events are usually well-accounted for in the adjustment factors, but given the tightness in the labor market, not all of the usual workers may be laid off.

Continuing claims showed no more than normal week-to-week fluctuations in the May 11 week, rising 12,000 to 1.676 million. The level remains low by historical standards. The insured rate of unemployment held at its record low of 1.2% for a 54th straight week.

There is nothing in this report to suggest the labor market is anything but robust.

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