WASHINGTON, Oct 28 (Reuters) - New U.S. claims for unemployment benefits unexpectedly fell last week, touching their lowest level in three months, a government report showed on Thursday.
Initial claims for state unemployment benefits dropped 21,000 to a seasonally adjusted 434,000, the lowest since the week ended July 10, the Labor Department said, and the second straight drop.
Analysts polled by Reuters had forecast claims edging up to 453,000 from the previously reported 452,000. The government revised the prior week's figure up to 455,000.
A Labor Department official said there was nothing unusual in the state data. The economy's painfully slow recovery from the worst recession since the Great Depression has left the labor market subdued and the unemployment rate at 9.6 percent.
Last week, the four-week average of new jobless claims, considered a better measure of underlying labor market trends, fell 5,500 to 453,250.
The number of people still receiving benefits after an initial week of aid dropped 122,000 to 4.36 million in the week ended Oct. 16. That was the lowest reading since the week ended Nov. 22, 2008. The prior week's number was revised up to 4.48 million.
Analysts polled by Reuters had forecast so-called continuing claims falling to 4.40 million from a previously reported 4.44 million. The continuing claims data covered the survey period for the household survey from which the unemployment rate is derived.
The number of people on emergency benefits declined 258,102 to 3.78 million in the week ended Oct. 9. (Reporting by Lucia Mutikani; Editing by Neil Stempleman)