Initial Claims for Jobless Insurance Fell

Initial claims for unemployment insurance last week were lower than Consensus expectations for 430,000. Claims fell 8.6% w/w to 405,000 and reversed virtually all of the prior week's jump. Claims in the prior week were revised down slightly.

Despite the decline, initial claims have been above 400,000 for eight consecutive weeks.

The four-week moving average of initial claims fell to 419,500, -3.6% y/y.

Continuing claims for unemployment insurance fell 1.9% w/w. During the last ten years there has been a 66% correlation (inverse) between the level of continued claims and the three month growth in nonfarm payrolls.

The insured rate of unemployment fell to 2.7%.

The U.S. foreign trade deficit narrowed in February for the second consecutive month. At $40.3B, the deficit was shallower than Consensus expectations for a deficit of $42.0B. January's deficit was little revised.

Exports added another 0.5% to the strong 1.7% January rise. Capital goods exports rose 5.0% (2.5% y/y), adding to the 2.6% gain in January. Food and other goods were the other sources of export strength in February.

Nonauto consumer goods exports gave back all of the gain in January with a 7.2% (0.8% y/y) decline. Exports of automotive vehicles, parts & engines rose 0.2% (5.5% y/y).

Imports fell for the second consecutive month. Capital goods imports fell 4.3% (1.5% y/y) following a 0.7% January decline. Imports of other goods and foods also fell hard. Nonauto consumer goods rose just 0.5% (10.3% y/y) following a sharp 4.1% January drop.

Imports of industrial supplies and materials rose 3.4% (36.0% y/y) but the value of energy related petroleum products fell slightly (89.6% y/y). The quantity of crude petroleum imports fell for the fifth month in six (1.5% y/y), though the per day quantity rose slightly. The per barrel price of crude petroleum rose 9.8% (83.9% y/y).

Prices for imported commodities rose 0.5% last month, right in line with Consensus expectations. The gain in prices in February was revised up due to a raised estimated of the gain in petroleum prices.

Petroleum import prices fell for the first month in four. So far in April the price of West Texas Intermediate crude has been in the $28-29/bbl range, down sharply versus $33.55/bbl averaged in March.

Nonpetroleum import prices rose by the most for any one month since January 2001 and the 0.9% gain was the record for this series. Strength centered in the foods category, up 1.3%, and in industrial supplies and materials (strong natural gas prices), up 1.8%. Prices of imported capital goods were unchanged (-1.3% y/y) and have been about unchanged since October. Nonauto consumer goods prices rose 0.1% following two months of no change (-0.1% y/y).

Export prices rose a 0.3% for the third consecutive month of strength.