U.S. Weekly Jobless Claims Drop To 787,000, Coming In Well Below Estimates

A report released by the Labor Department on Thursday showed a decrease in first-time claims for U.S. unemployment benefits in the week ended October 17th.

The Labor Department said initial jobless claims fell to 787,000, a decrease of 55,000 from the previous week's revised level of 842,000.

Economists had expected jobless claims to drop to 860,000 from the 898,000 originally reported for the previous week.

Along with the notable downward revision to the previous week's number, the report showed initial jobless claims in the week ended October 3rd were downwardly revised to 767,000 from 845,000.

The Labor Department noted the latest release reflects actual counts for California, which has completed its pause in processing of initial claims and resumed reporting actual unemployment insurance claims data.

The report said the less volatile four-week moving average dipped to 811,250, a decrease of 21,500 from the previous week's revised average of 832,750.

Continuing claims, a reading on the number of people receiving ongoing unemployment assistance, also tumbled by 1.024 million to 8.373 million in the week ended October 10th.

The four-week moving average of continuing claims plunged to 10,085,750, a decrease of 1,093,500 from the previous week's revised average of 11,179,250.

"Continuing claims fell by more than 1 million, but that positive trend is partly offset by a rise in the number of individuals who have exhausted regular benefits, which totaled more than 3.7 million in the week ended October 3," said Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics.

She added, "Failure to pass additional fiscal relief measures that include emergency unemployment benefits poses considerable downside risk to the economy, particularly with Covid-19 cases on the rise, raising the possibility of new restrictions."