Initial claims were unchanged at 264,000 in the week ended June 17, slightly above expectations of 261,000 in an Econoday survey. The previous week was revised up from 262,000. This is the fifth consecutive week with no decline, signalling the resilience of the labor market is being tested.

In a third consecutive advance, the four-week average increased 8,500 to 255,750, the highest level since the November 13, 2021 week. The previous week was revised up from 246,750.

By contrast, continuing claims in lagging data for the June 10 week were down 13,000 to 1.759 million, not enough to offset the previous week's increase of 17,000. The unemployment rate for insured workers held at 1.2 percent for the eighth consecutive week.

With above-expected initial claims at their highest level since October 2021 and a below-expected Chicago Fed National Activity Index, today's data drove Econoday Consensus Divergence Index down to 2, consistent with a stable monetary policy.

Jobless claims for the June 17 week, at a consensus 261,000, are not expected to come down from 262,000 in the two prior weeks, a level that marked a significant shift higher.

New unemployment claims are compiled weekly to show the number of individuals who filed for unemployment insurance for the first time. An increasing (decreasing) trend suggests a deteriorating (improving) labor market. The four-week moving average of new claims smooths out weekly volatility.

Jobless claims are an easy way to gauge the strength of the job market. The fewer people filing for unemployment benefits, the more have jobs, and that tells investors a great deal about the economy. Nearly every job comes with an income that gives a household spending power. Spending greases the wheels of the economy and keeps it growing, so a stronger job market generates a healthier economy.

There's a downside to it, though. Unemployment claims, and therefore the number of job seekers, can fall to such a low level that businesses have a tough time finding new workers. They might have to pay overtime wages to current staff, use higher wages to lure people from other jobs, and in general spend more on labor costs because of a shortage of workers. This leads to wage inflation, which is bad news for the stock and bond markets. Federal Reserve officials are always on the look-out for inflationary pressures.

By tracking the number of jobless claims, investors can gain a sense of how tight, or how loose, the job market is. If wage inflation looks threatening, it's a good bet that interest rates will rise, bond and stock prices will fall, and the only investors in a good mood will be the ones who tracked jobless claims and adjusted their portfolios to anticipate these events.

Just remember, the lower the number of unemployment claims, the stronger the job market, and vice versa.