US unemployment, 0.4 more than estimates, but "in line with forecasts"

Increase in teenagers' unemployment expanded the job pool which apparently is the main source of unexpected jump in the headline. Economists believe that some of the increase may come from Commerce Department's difficulty in seasonal adjustment, considering earlier end to school year.

Bloomberg said: "Lehman Brothers Holdings Inc. economists estimated the unemployment rate may drop back by 0.1 or 0.2 percentage point in June because of the seasonal-adjustment effect. David Resler, chief economist at Nomura Securities International in New York, said the May rate was as much as 0.3 percentage point higher because of the school-year impact."

The rise in unemployment "was in line with forecasts,'' James Bullard, Federal Reserve Bank of St. Louis said yesterday.

From the policy maker's perspective, when they express concerns about inflation, I think they have incorporated the unemployment rise in their calculations.