Initial jobless claims came in less than expected in the latest week, rising by 2,000 in the week ending March 15 from the revised 221,000 level (previously 220,000) reported for the prior week. The March 15 week's level compares to the consensus of 225,000 in the Econoday survey of forecasters. The four-week moving average is up by 750 to 227,000 in the March 15 week, after 226,250 in the prior week.

Seasonal factors had expected a decline in unadjusted claims of 9,285 (-4.3 percent) from the previous week, but they fell by 7,502 (-3.5 percent), instead.

There was a noticeable rise in unadjusted first-time claims filed in Michigan, while there was a large decline in initial claims reported by California.

Insured unemployment increased by 33,000 in the March 8 week to 1.892 million, from a downwardly revised 1.859 million in the prior week and continuing claims are 97,000 higher compared to the same week a year ago, underscoring the ongoing difficulties many face in finding employment. The four-week moving average is up by 6,250 to 1.876 million, from a revised 1.870 million in the March 1 week. The insured rate of unemployment remained at 1.2 percent in the March 8 week.

Looking past the constant volatility of the initial claims numbers, the elevated level of continuing claims (yet to drop below 1.8 million since June 2024), underlines the risks to the employment aspect of the Federal Reserve's dual mandate.

Claims are expected to edge up to 225K in the latest week after an unexpected downtick to 220K from 222K last week and from 242K the week before that. Suggests a relatively stable labor market.

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.