Dollars and Jens
Friday, July 17, 2009
seasonal adjustments and the business cycle
Note some important caveats about seasonally adjusted data:
On an unadjusted basis, the initial claims data showed a fairly large increase last week—up 86,000 workers. But claims for unemployment compensation typically rise in early July as auto plants shut down to retool for the new model year. The jump in claims this July hasn't been as large as in years past since many of the auto plants were waylaid earlier in the year. So on a "seasonally adjusted" basis, the data showed a drop in claims of 47,000 workers.
Fewer remaining factory workers might reduce the number of workers available to furlough. Similarly, some of the price increases pushing up the recent CPI report were actually decreases which might have run into support as already squeezed margins simply couldn't squeeze as much as usual.


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