Jobless claims fall sharply

The number of Americans seeking new claims for jobless benefits falls to the lowest level in months.

June 23, 2005: 8:33 AM EDT

WASHINGTON (Reuters) - The number of Americans seeking new claims for jobless benefits fell by a larger-than-expected 20,000 last week to the lowest level in two months, the government said Thursday.

First-time claims for state unemployment insurance aid fell to 314,000 in the week ended June 18 from a slightly revised 334,000 in the prior week, the Labor Department said.

The drop exceeded Wall Street forecasts for a dip to 330,000 from the original reading of 333,000 in the week ended June 11. The decline brought the claims to their lowest level since 299,000 in week ended April 16.

A Labor Department analyst said there were no special factors behind the drop.

The closely watched four-week moving average, a better indicator of the labor market's health because it smoothes weekly volatility, also fell, dropping 2,500 last week to 333,000.

The number of people who remained on the benefit rolls after drawing an initial week of aid fell 38,000 to 2.6 million in the week ended June 11, the latest for which the data are available.