Initial unemployment claims rose 10,000 to 379,000 in the Dec. 14 week, the payroll survey period.

There were no special factors, but the Labor Department analyst said during the holidays it's better to look at trends: the 4-week average is 344,000. He said any one weekly number is unreliable in December due to the difficulties of seasonally adjusting the readings, and it will not be until well after the New Year's holiday that spot claims readings give more reliable information.

We suspect that 344,000 is probably within 10,000 of where claims will shake out. This average has been below 330,000 only once this year.

This week compares to 326,000 in the week covering mid-November, and thus was elevated for payroll comparisons. But we doubt the recent move is signaling a very weak December payroll reading or the start of a trend towards large layoffs.

Claims fell roughly from Veterans Day to Thanksgiving during November, then rebounded in December. Holidays and end-of-year moves make interpreting weekly data very difficult. A working assumption should be that January's claims fall back to trend.

Continuing claims were 2.884 million in the Dec. 7 week. These claims have been on a downtrend since summer, reflecting both a lower unemployment rate and the cessation of some programs that extended benefits.

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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