U.S. Jobless Claims Slip

For the week ended March 18, U.S jobless claims fell by 11,000 to 302,000, the Labor Department said March 23, potentially ringing alarm bells for the Federal Reserve.

Initial claims were at their lowest level since February 24 during the week. Analysts had forecast a higher figure of 305,000.

The four-week average of new claims, which strips out one-time events such as holidays and weather, rose by 6,000 to 303,500.

The new low in weekly claims is a sign the jobs market is still strengthening, which could concern the Federal Reserve as the U.S. central bank prepares to meet next week. The Fed, under the new chairmanship of Ben Bernanke, is expected by economists to raise the interest by a quarter point to 4.75 percent on March 28. Most Fed watchers expect at least one further rate hike at the bank's following meeting on May 10. Fed officials have raised concern that tight labor markets could turn into higher wages and therefore into higher inflation.

Copyright Agence France-Presse, 2006

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