Initial claims for unemployment insurance fell a sharp 20,000 to 314,000 last week, the lowest level in two months. Consensus expectations had been for 330,000 claims and the prior week's figure was revised up slightly.

The latest figure covers the survey period for nonfarm payrolls in June and was down 8,000 (-2.5%) from the May period.

During the last ten years there has been a (negative) 75% correlation between the level of initial claims for unemployment insurance and the monthly change in payroll employment. There has been a (negative) 65% correlation with the level of continuing claims.

The four week moving average of initial claims fell slightly to 333,000 (-3.5% y/y).

A 38,000 decline in continuing claims for unemployment insurance retraced most of the prior week's downwardly revised 56,000 jump.

The insured unemployment rate fell back to 2.0% from 2.1% the prior week.

More Life vs. More Goods: Explaining Rising Health Expenditures from the Federal Reserve Bank of San Francisco can be found here.