Highlights

After a one-week shock, the initial claims level dropped back below 350,000. The initial claims level fell to 340,000 for the week ending May 18 from an upwardly revised 363,000 (from 360,000) for the week ending May 11. The Briefing.com consensus expected the initial claims level to fall to 348,000.
The continuing claims level decreased from an upwardly revised 3.024 mln (from 3.009 mln) for the week ending May 4 to 2.912 mln for the week ending May 11. The consensus expected the continuing claims level to fall modestly to 3.005 mln.

Key Factors

As we expected, the increase in claims last week seems to have been the result of normal week-to-week movements of a highly volatile data series. The jump, which brought the initial claims level to its highest point since February (excluding the biases from the Easter holiday), was not a change in trends.
Layoff levels have stabilized.

Employment conditions have not changed. The spike, which brought the claims level above 350,000 for the first time since February, was not the start of a new upward moving trend.

Category	May 18	May 11	May 4	Apr 27	Apr 20
Initial Claims	340K	363K	328K	327K	342K
4-Wk Moving Avg	340K	340K	338K	343K	358K
Continued Benefits		2912K	3024K	3013K	3032K
4-Wk Moving Avg		2995K	3019K	3036K	3059K