By Brian Baker
Initial weekly jobless claims rose during the week ended March 3 after hitting the lowest level since December 1969 in the previous week.
Jobless claims, which measure the number of Americans filing for first-time unemployment benefits, rose 21,000 to a seasonally adjusted 231,000 during the most recent week, according to the Department of Labor. Economists polled by Reuters were expecting initial claims of 220,000.
The four-week moving average, which is viewed as a more stable measure, increased 2,000 to 222,500 from the previous week’s average.
Continuing claims declined 64,000 to 1.87 million during the week ended Feb. 24. Continuing claims are released with a one-week lag and measure the number of people receiving benefits beyond the initial week.
The report marked the 157th consecutive week that initial claims were below 300,000, which economists believe is a sign of a healthy labor market.
Source: Federal Reserve Bank of St. Louis
The strong job market has led some to believe it will lead to a rise in wages and inflation.
“Unemployment is near multi-decade lows and is likely to continue to decline this year,” James Sweeney, chief economist in fixed income research at Credit Suisse, wrote in a note to clients on Wednesday. “Wages have shown signs of a gradual acceleration and we expect growth to rise to 3.0%-3.5% this year,” he wrote.
The Labor Department will release its February employment report on Friday, and economists expect the unemployment rate to decline 0.1 percentage point to 4 percent.
Jonathan Golub, chief U.S. equity strategist at Credit Suisse, is concerned that wage growth could lead to changes in Federal Reserve monetary policy. “While not yet problematic, an overheating labor market poses the greatest threat to profit margins and could force the Fed to become more engaged,” he wrote in a note to clients.
The Standard & Poor’s 500 index increased 0.4 percent to 2,739.