Though The forecast number of Jobless Claims was 214000, the actual number was falling down to 190000 and this ‘Actual’ number which is less than ‘Forecast’ is good for currency.
Why do the jobless claims number matter to forex traders?
Although it’s generally viewed as a lagging indicator, the number of unemployed people is an important signal of overall economic health because consumer spending is highly correlated with labor-market conditions. Unemployment is also a major consideration for those steering the country’s monetary policy;
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Based on U.S Department of Labor report, The number of individuals who filed for unemployment insurance for the first time during the past week unexpectedly fell, from 205000 to 190000!!
It goes without saying that, underscoring a strong jobs market where many businesses are reluctant to let go of workers.
“The drop in initial jobless claims … reflects volatility from extreme winter weather in parts of the country that made seasonal adjustments problematic. A cleaner read might come next week, but the trend likely will continue to dovetail with the tone of the Federal Reserve’s latest Beige Book, which noted a persistently tight labor market.”
— Eliza Winger, economist