Initial jobless claims
Initial jobless claims are reported weekly by the U.S. Department of Labor. They show the number of people filing for jobless benefits for the first time in the US. The strength of the job market depends on people having jobs with an income.
Initial jobless claims hover near 15-year low
Initial jobless claims for the week ending May 29 came in at 276,000. This is 8,000 less than the previous week’s 284,000. This was its lowest reading since 2000. It also came in below expectations of 282,000. The four-week moving average was 274,750—the lowest level since May 2000.
Since weekly data could have statistical noise, analysts usually prefer the four-week average of jobless claims. The average of jobless claims climbed 2,750 week-over-week to 274,750. However, this level is also close to historical lows.
This measure suggests that the labor market was firm in May.
Implications for gold investors
Labor market strength is positive for the economy and the US dollar.
Any sustained improvement on this front may lead the Fed to increase interest rates earlier than expected. This information impacts gold-backed ETFs like the SPDR Gold Trust (GLD).
Other affected investments include Eldorado Gold (EGO), Gold Fields (GFI), Newmont Mining (NEM), and Yamana Gold (AUY). It also affects ETFs that invest in these stocks like the VanEck Vectors Gold Miners ETF (GDX). Together, Newmont Mining and Yamana Gold account for 10.1% of GDX’s holdings.
In the next part of this series, we’ll look at another important piece of information in the US labor market—the net job adds.