Merk Investments: Jobless Claims

Jobless claims for the week ending May 17 fell 9K to 365K and the four-week moving average increased to 372K. Initial claims, which are released with a one-week lag, held at 3.073mln.  The initial claims data is the final sampling for the May non-farm payrolls and does suggest a flat to modestly negative number when the employment report is released at the end of next week. The sustained move above 3.0mln in the initial claims data should support a further curve steepening and provide additional negative momentum for the equities market after a very difficult two days.  Overall, the data tends to support our call of a move in the unemployment rate to 5.5% by the end of the year, which we are happy to say, the Fed now agrees with.

Joseph Brusuelas
Merk Investments
Chief Economist/VP Global Strategy

This report was prepared by Merk Investments LLC, and reflects the current opinion of the author.  It is based upon sources and data believed to be accurate and reliable.  Opinions and forward looking statements expressed are subject to change without notice.  This information does not constitute a solicitation or an offer to buy or sell any investment product, nor provide investment advice. Merk Investments does not own any of the stocks mentioned; this is not an offer to buy or sell any security mentioned.