March 27, 2014
Jobless claims fell to a four-month low during the week that ended on March 22, according to figures from the U.S. Department of Labor.
The decline in applications signals improvement in the economy, and if conditions continue to get better for consumers, they may have more motivation to access credit. This rise in demand for lending could be a boon for loan sale activity.
Several key measures decline
The number of these applications for unemployment assistance fell by 10,000 to reach 311,000 during the week. The four-week moving average also declined, dropping to 317,750 from the prior figure of 327,250. Many consider this measure, which takes a longer period into account, to be far less volatile than the data for a single week.
In addition, the total number of continuing jobless claims fell by 53,000 to reach a seasonally-adjusted level of 2.82 million during the week that ended March 15.
Weekly claims fall to lowest since November
The weekly jobless claims number fell to its lowest reading since November, according to Bloomberg. The figure fell short of the median forecast of 323,000 claims provided by economists taking part in a poll conducted by the media outlet. The result also beat the prediction of 325,000 applications provided by market experts polled by Dow Jones, The Wall Street Journal reported.
In addition, the four-week average dropped to its lowest since September, according to Bloomberg.
"It seems to be genuinely good news for the labor market," Guy Berger, who works for RBS Securities Inc. as a U.S. economist, told the news source. "In all likelihood, employment growth in March is going to be stronger than what we've seen in the last three months."
Market experts taking part in a poll conducted by the media outlet have provided a preliminary median forecast that the nation's employers will add 190,000 new positions in March, after bolstering payrolls by 175,000 in February.
In addition, the economic recovery could accelerate as the weather improves, considering many have blamed the recent weakness in conditions on the long winter, according to The Wall Street Journal. Janet Yellen, chair of the Federal Reserve, recently confirmed the weather situation has certainly played a part in the expansion's slowdown.
Market expert predicts strengthening conditions
Tom Simons, an economist at Jefferies LLC in New York, told Bloomberg he expects the business climate to improve in the coming months.
"Activity in the second quarter is going to represent something of a rebound from the first quarter," Simons told the news source. "We've seen enough good numbers recently to say that it is a sign of fundamental improvement."
Banks that are interested in buying loan portfolios during this time of improving business conditions may want to consider speaking with Garnet Capital Advisors, which has years of experience in loan sales.