US initial jobless claims drop to lowest level since December 1969

The number of Americans filing for unemployment benefits fell to the lowest level since 1969 last week, according to figures from the Labor Department.

US initial jobless claims dropped by 8,000 to 207,000 from the previous week's level, which was revised up by 1,000. This was the lowest level since 6 December 1969 and beat expectations for an increase to 220,000.

Meanwhile, the four-week moving average declined by 2,750 to 220,500 from the previous week's average, which was revised up by 250.

The four-week average is considered more reliable as it smooths out sharp fluctuations in the more volatile weekly figures, giving a more accurate picture of the health of the labour market.

Ian Shepherdson, chief economist at Pantheon Macroeconomics, said claims are being distorted by seasonal problems caused by the 4 July holiday and the automakers' annual retooling shutdowns, making the numbers even less predictable than usual.

"The trend is in the low 220s; claims will return to that level overthe next few weeks," he said.