US jobless claims data suggest continued strength in labour markets - Nomura

Analysts at Nomura noted that jobless claims data suggest continued strength in labour markets as fluctuations in claims data caused by hurricanes wane. 

Key Quotes:

"Initial claims continued to decline to 222k in the week of 14 October from 244k previously, marking the lowest reading since March 1973. Its 4-week average also came down to 248k."

"There was no evidence of the impact from recent wildfires in California. Continuing claims declined to 1888k in the week of 7 October from 1904k in the previous week."

"Continuing claims were the lowest since November 1981. The insured unemployment rate inched downwards to 1.3% from 1.4%, the lowest since its inception, suggesting that the unemployment rate (which includes uninsured job seekers) could decline further in coming months. That said, arguably the key driver of job creation is the pace of hiring rather than layoffs. The number of new hires plateaued in recent months."

"It appears that the impact from hurricanes has now disappeared completely. However, due to power disruptions in Puerto Rico and the Virgin Islands after Hurricane Maria, filing was significantly delayed or disrupted. Thus, we could see another transitory increase in coming weeks as those regions continue to recover."