[ForexNews]

Initial jobless claims declined 4,000 to 621,000 in the week ending May 30, slightly above market consensus expectations of 620,000. The four-week moving average inched up to 631,000, which is still considerably below the peak of 658,000 reached at the end of March. Continuing jobless claims declined by 15,000to 6.735mn, marking the first decline since early January. The decline in continuing jobless claims is due to people exhausting their unemployment benefits, some people finding new employment, and the decline in initial jobless claims. However, after employees exhaust the 26 weeks of continuing jobless claims, they will be able to file for Emergency Unemployment Compensation (EUC) and extended benefits, which can provide another 53 weeks of insurance.

The decline in jobless claims suggests a moderation in the pace of job cuts and a slowing in the recession. Market expects tomorrow's employment report to show a decline of 500,000 in nonfarm payrolls and an unemployment rate of 9.2%.