Jobless Claims Unwind Omicron Uptick, Mortgage Rates Fall

What Thursday’s Economic Reports Tell Us

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Unemployment claims retreated for a second week, settling into pre-pandemic levels, mortgage rates dipped, and growth in the services sector disappointed.

Here’s a quick look at the most significant economic indicators of the day and what they tell us.

Jobless Claims

  • First-time unemployment claims declined for a second week to 215,000 from the previous week’s revised level of 233,000, remaining firmly in the range of pre-pandemic times, the Department of Labor said Thursday. 
  • The number of claims has fallen again after a brief uptick in January caused by the spread of the omicron variant of COVID-19. Last week’s drop was larger than what economists expected—the median forecast was for 225,000 unemployment claims.

Mortgage Rates

  • Mortgage rates fell this week, with the average rate on a 30-year fixed loan falling to 3.76% from 3.89%, Freddie Mac said. 
  • Rates followed yields for treasury bonds, which tumbled amid investor worries about the economic consequences of Russia’s invasion of Ukraine. 

Economic Activity in Services

  • Business activity in the services sector increased in February but lost momentum, according to the Institute for Supply Management. The ISM index measuring growth in activity in the sector fell to its lowest level in a year as businesses struggled with now-familiar disruptions.
  • The institute’s survey of purchasing and supply executives in food services and accommodation, health care, construction, and numerous other industries revealed problems with supply chains, inflation, and finding enough workers. The setback came as a surprise to economists, who had expected the level of growth to increase, not decline.

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Article Sources

  1. Department of Labor. “News Release.”

  2. Freddie Mac. “Mortgage Rates.”

  3. Institute for Supply Management. “February 2022 Services ISM ® Report On Business.”