Dollars and Jens
Thursday, August 05, 2004
Initial claims
The unemployment data buoyed the U.S. dollar as traders braced for a strong U.S. July payrolls report on Friday.

The closely watched four-week moving average of new claims, which irons out weekly volatility, rose to 343,500 in the week ended July 31 from 336,750 in the previous week.
That's successive paragraphs. It has to occur to them that it looks odd, doesn't it?

The lowest single-week number since around the beginning of time was four weeks ago; the uptick in the sliding average is largely a consequence of that. I use a smoothing function that doesn't have this property.

Vertical lines denote quarters — i.e. the end of December, March, and June — while horizontal lines denote multiples of 25,000 claims — i.e. 325,000, 350,000, and 375,000. It's basically been parked at 340,000 for three months, arguably five.

I don't see the decline of which they write in the paragraph after my excerpt; neither am I bracing myself for a strong jobs report tomorrow morning, but what do I know? This, I suppose: that the payroll number has a lot more noise in it than the market seems to realize, and trying to predict it with too much precision is probably a fool's mission. If a physics student of mine indicated that a value was "228,000 +/- 190,000", I'd at least warn on significant digits.

(0) comments
Post a Comment

Powered by Blogger