WASHINGTON — Initial claims for U.S. state unemployment benefits were lower than expected in the May 4 week, continuing their downward trend by falling by 4,000 to 323,000, the Labor Department reported Thursday.

The level of initial claims was the lowest since 321,000 in the January 19, 2008 week.

Expectations in an MNI survey of analysts for this week's report was for a claims level of 335,000, an increase of 11,000 from the previously reported 324,000 level in April 27 week. The initial claims level in that week was revised up slightly to 327,000.

The initial claims seasonally adjusted 4-week moving average fell 6,250 to 336,750 in the May 4 week, a third straight decline to the lowest level since the November 24, 2007 week, when it was 336,000.

A Labor Department analyst said that there was nothing unusual in the state level data and that there were no states estimated in the current week.

The analyst said that seasonal adjustment factors had expected a 0.2% rise in unadjusted claims, or only 654 claims, in the May 4 week. Instead, unadjusted claims fell 0.9%, or 2,638, to 298,497. That level is below the 341,080 level reported in the comparable week a year ago.

The state data released for the April 27 week indicated unadjusted initial claims increased in 10 states and declined in 43 states, with no states unchanged. The District of Columbia, Puerto Rico, and Virgin Islands are included in this data.

The level of continuing claims came in at 3.005 million after seasonal adjustment in the April 27 week, a decline of 27,000 from the previous week and the lowest level since the May 10, 2008 week.

The level of unadjusted continuing claims fell 66,039 to 2,962,467 in the April 27 week, well below the 3,210,670 level in the comparable week a year ago.

The seasonally adjusted insured unemployment held steady at 2.3% in the April 27 week, still below the seasonally adjusted 2.6% rate in the comparable week 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.

The Labor Department said that the level of unadjusted Emergency Unemployment Compensation benefits claims fell 14,560 to 1,763,177 in the April 20 week.

The Labor Department reported that a total of 4,874,526 persons claimed unemployment benefits in the April 20 week, an 89,292 drop from the previous week, and still well below the 6,423,153 persons in the comparable week a year ago. These data are not seasonally adjusted, and include regular state claims, federal employee claims, new veterans claims, the EUC and extended benefits programs, state additional benefits, and STC/Workshare claims.

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

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