US weekly jobless claims up 19,000; continuing claims at over 2-yr high

WASHINGTON, Feb. 28, 2008 (Thomson Financial delivered by Newstex) -- The number of people filing new claims for unemployment insurance rose above expectations in the latest week while continuing claims for unemployment climbed to its highest level in over two years, the Labor Department said today.The number of first-time claims filed in the week ending Feb 23 rose by 19,000 to 373,000 from an upwardly revised 354,000 claims in the previous week. That's well above the 350,000 claims economists polled by Thomson's IFR Markets had expected.The unexpected increase in initial claims 'is a move towards levels providing a signal indicating recession,' said Joseph Brusuelas of IDEAglobal.'The level of claims this week now matches the four-week average recorded at the end of February 2001, immediately before the recession began in March,' said Ian Shepherdson of High Frequency Economics.But Richard Iley of BNP Paribas (OOTC:BPRBF) said the level of initial jobless claims are 'still surprisingly low,' adding that 'historically, weekly claims of around the 400,000 level have been associated with recession and negative non-farm payroll prints.'The Labor Department also reported that the four-week moving average for initial claims decreased by 1,250 to 360,500.Economists prefer the four week moving average because it smoothes out fluctuations in the weekly data.For the week ending Feb 16, the number of individuals continuing to receive unemployment insurance rose by 21,000 to 2.807 mln from an upwardly revised 2.786 mln claims in the previous week. That's above the 2.800 mln claims economists were expecting and the highest level since October 2005.The four-week moving average for continuing claims increased 24,250 to 2.778 mln, the highest level since October 2005.'The continuing claim data is consistent with a strong 5.0 pct rate of unemployment with a risk to the upside for the February payroll period,' Brusuelas said.Rising continuing claims 'suggests that it is becoming more difficult for people who have lost their job to find new employment,' said economists from Bear Stearns. (NYSE:BSC) 'Jobs are a clue about what happens with the economy' and while this week's jobless claims numbers indicate softening, 'I don't think its going to change the dollar's direction,' said Meg Browne of Brown Brothers Harriman.