WASHINGTON – Initial claims for U.S. state unemployment benefits rose by 10,000 to a level of 247,000 in the Jan. 7 week, well below the 260,000 level expected following a small upward revision to the previous week, data released by the Labor Department Thursday showed.

Seasonal adjustment factors had expected an increase of 12.2%, or 42,665, in unadjusted claims in the current week. Unadjusted claims instead rose by 59,308 to 409,869 after a smaller than expected increase in the previous week. The current week's unadjusted level was still well below the 502,904 level in the comparable week a year ago.

Unadjusted claims usually post one of their largest gains of the year in the first week of a calendar year, followed by declines in the next two weeks.

Virginia state claims were estimated by the state itself due to weather issues and the Monday holiday.

The four-week moving average for initial claims fell by 1,750 to 256,500 in the Jan. 7 week. If the headline number of claims does not change next week and there are no revisions, the average will fall by 7,000 as 275,000 level in the December 17 week rolls out of the calculation.

The level of continuing claims fell by 29,000 to 2.087 million in the Dec. 31 week, breaking the string of four straight gains. Before seasonal adjustment, continuing claims for the Dec. 31 week surged by 207,386 to 2.461 million. This level was well below the 2.803 million level seen in the comparable week a year ago.

The seasonally adjusted insured unemployment rate held steady at 1.5%, down slightly from 1.6% a year earlier.

The unemployment rate among the insured labor force is well below that reported monthly by the Labor Department because claims are approved for the most part only for job losers, not the job leavers and labor force reentrants included in the monthly report.

Market News International is a real-time global news service for fixed-income and foreign exchange market professionals. See www.marketnews.com.

Market News International is a real-time global news service for fixed-income and foreign exchange market professionals. See www.marketnews.com.