INSTANT VIEW: Jobless claims fall in latest week

NEW YORK (Reuters) - The number of workers filing new claims for unemployment benefits fell unexpectedly by 24,000 last week, government data showed on Thursday, but the number of people remaining on jobless rolls rose to a fresh 26-year high.

KEY POINTS: * Initial claims for state unemployment insurance benefits fell to a seasonally adjusted 467,000 in the week ended January 3 from a slightly downwardly revised 491,000 the prior week, the Labor Department said. * It was the lowest reading for initial claims since the week ending October 11 last year, when the figure was at 463,000. * Analysts polled by Reuters had forecast 540,000 new claims versus a previously reported figure of 492,000. * Continuing claims jumped to 4.611 million in the week ended December 27, the latest week for which the data is available, from 4.510 million the previous week. This was the highest reading since the week ending November 20 1982.

COMMENTS:

DAVID WATT, SENIOR CURRENCY STRATEGIST, RBC CAPITAL MARKETS,

TORONTO:

"I don't think jobless claims has any implications for nonfarm payrolls. It covers a holiday period, so people were delaying filing their claims. There is going to be a surge next week, and the ADP report showed nonfarm payrolls is going to be a mess. So I don't think this is indicative of the trend, and if anything, I'm surprised the consensus call was so high, as people knew this was the Christmas/New Year's week. The rise in the euro, I think, has more to do with other signs of labor market woes in the U.S."

JANE CARON, CHIEF ECONOMIC STRATEGIST, DWIGHT ASSET MANAGEMENT,

BURLINGTON, VERMONT:

"This was certainly a surprise decline in claims. Most economists including ourselves thought claims would rebound this week.

"But offsetting that good news, continuing claims rose to 4.6 million.

"I don't think the improvement in today's initial claims will shift expectations for tomorrow's payrolls number.

"Treasuries will probably stay bid at least until tomorrow morning's payrolls data."

PIERRE ELLIS, SENIOR GLOBAL ECONOMIST, DECISION ECONOMICS INC.,

NEW YORK:

"This number and last week's involve holidays and they attempt to seasonally adjust for them. We have to see if they will hold in the coming weeks.

"You are still seeing a lot of people of collecting unemployment claims so the underlying conditions are very poor. The bad news in the continuing claims is relentless.

"Technically, these numbers don't relate to the December payroll number. We are looking for minus 475,000 in payrolls last month and they could be worse."

"The jobless rate should jump three-tenths of a percentage point to 7 percent. The message is the weak economy is hurting the job market and that will affect consumer spending going forward. There is a serious snowballing process underway."

MARKET REACTION: STOCKS: U.S. equity index futures initially pare losses after jobless claims data. BONDS: U.S. Treasuries hold steady. DOLLAR: U.S. dollar little changed versus euro.