And so the economic "improvement" data takes another big step back after the rumored improvement in claims reverts, following the traditional negative prior revision to 371K, coming at 397K on expectations of 376K. Non-seasonal claims surge by 52K higher from 354K to 406K. Continuing claims declined from an upward revised 3791K to 3771K, missing expectations of 3750K. And according to a BLS official this time the factor to blame is "school holidays." It appears there was no snow last week. Disturbingly, those on EUCs and Extended Benefits surged by 200K.
From the report:
The advance number of actual initial claims under state programs, unadjusted, totaled 406,096 in the week ending March 5, an increase of 52,147 from the previous week. There were 459,523 initial claims in the comparable week in 2010.
The advance unadjusted insured unemployment rate was 3.5 percent during the week ending Feb. 26, unchanged from the prior week. The advance unadjusted number for persons claiming UI benefits in state programs totaled 4,442,438, an increase of 97,576 from the preceding week. A year earlier, the rate was 4.3 percent and the volume was 5,538,966.
The total number of people claiming benefits in all programs for the week ending Feb 19 was 8,772,818.
Extended benefits were available in Alabama, Alaska, Arizona, California, Colorado, Connecticut, Delaware, the District of Columbia, Florida, Georgia, Idaho, Illinois, Indiana, Kansas, Kentucky, Maine, Massachusetts, Michigan, Minnesota, Missouri, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Virginia, Washington, West Virginia, and Wisconsin, during the week ending Feb 19.
As we have been expecting all along, the economic data has hit an inflection point and is now trending lower, and Goldman will come out with a downward economic revision within a few weeks, setting the stage for QE3.