Initial jobless claims beat expectations of a decline of 6,000 and dropped to 344,000 in the week ending Feb. 23. Wall Street had estimated 360,000 applicants for unemployment benefits. Fourth-quarter gross domestic product (GDP) was also revised upward from -0.1 percent to 0.1 percent.
“The four-week moving average has held in a range between 350,000 and 360,000 throughout, which is somewhat lower than that of December. So perhaps there is some modest improvement,” wrote Citigroup Inc. about the jobless claims released by the Department of Labor on Feb. 28.
On the downside, Emergency Unemployment Compensation, which is currently granted in certain cases when standard benefits run out, went up by 8.5 percent—or 187,000—to 2 million. This federal program expires in January of 2014.
Fourth-quarter GDP growth was revised upward by the Bureau of Economic Analysis. An initial estimate saw the economy declining by 0.1 percent compared to the third quarter, but a revised estimate saw a 0.1-percent increase. The reason for the change was a higher-than-expected gain in trade.
Citigroup economists project that growth will improve throughout 2013 and 2014.
“We continue to expect that economic growth this year will be near 2½ percent … and pick up further in 2014,” Citigroup chief economist Willem Buiter wrote in a note to clients.
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