US jobless claims fall sharply

New claims for US unemployment insurance benefits registered a bigger-than-expected drop last week but still remained elevated amid an ailing labor market, official data showed Thursday. Initial jobless claims fell by 22,000 to 405,000 in the week ending July 9, the Labor Department said. The prior week's number was upwardly revised to 427,000. The average analyst estimate was for a smaller decline in claims, to 410,000. A Minnesota state shutdown resulted in about 11,500 new claims, the department noted. It was the 14th week in a row that US jobless claims held above the 400,000 mark, after dropping below that threshold from February to April in a trend that had encouraged hopes that a struggling economic recovery was gaining traction. The four-week moving average last week was 423,250, down by 3,750 from the week ending July 2. The jobless claims report for the first week of July followed grim labor data for June that showed job creation stalled in the world's largest economy and that the unemployment rate rose to 9.2 percent.