Jobless Claims Number Suggests Rate Hike Delay: Expert

Weekly jobless claims rose less than analysts expected last week.

According to Labor Department data, for the week ended September 10, the number of Americans filing for first-time unemployment benefits rose by 1,000 to a seasonally adjusted 260,000. While the increase isn't negligible, it's still well below the anticipated 6,000. Economists surveyed by both the Wall Street Journal and Reuters had estimated 265,000 jobless claims for last week.

It’s important to note that jobless claims had not been so consistently low since 1970. Last week marked the 80^th consecutive week with less than 300,000 jobless claims.

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How does this affect the outlook for a Fed rate hike, given the Fed's position on the economy's employment capacity? The jobless claims number probably diminishes the changes of a rate hike in September.

“The economy continues to show mixed signals as fewer than expected jobs were created,” said Joe Correnti, Scottrade's Sr. VP of Brokerage Products.

“Expectations for inflation and GDP continue to trend flat to downward, again both indicators the Fed typically pays attention to when consider a rate change,” he concluded.